In the US, HP and EDS staff took an immediate 5-20% haircut. But in Australia and New Zealand, employees are being asked to voluntary sign on to the salary reduction.
HP, which finalised its takeover of services giant EDS late last year, announced a global plan to reduce salaries on February 20. The cuts were pitched as a manoeuvre to avoid mass layoffs across both companies.
Chief executive Mark Hurd led the world wide pay-packet trim across HP/EDS, losing 20% of his own salary. Members of the company’s executive council took an immediate 15% haircut; other managers got a 10% trim and regular staff 5%.
Speaking at a media and analyst briefing in Auckland this morning, EDS Australia and New Zealand managing director David Caspari (pictured) said while the pay cuts had taken immediate effect in the US, other countries had different labour laws, preventing a blanket roll-out of Mr Hurd’s plan.
In Australia and New Zealand, HP and EDS staff are being asked to voluntarily sign on to the pay cut plan.
Asked if he had volunteered, Mr Caspari replied “Absolutely. Ten per cent.”
Mr Caspari says he is pitching the merits of the pay cut to EDS staff as a measure “to get the company’s cost structure where it needs to be." EDS is also talking to unions on both sides of the Tasman, but EDS New Zealand country Alfonso Gomez says that unions are much less of a factor in New Zealand than Australia.
There is no deadline for staff to sign on to the voluntary agreement, says Mr Caspari.
Merger-related redundancies to come
Mr Hurd's pay cut scheme was pitched as a way to avoid redundancies related to the economic slowdown.
Ironically, it was announced in the wake of a quarterly result that looked positively buoyant worldwide next to other big techs, and in which EDS was a star performer. In New Zealand, profit increased 64%.
But earlier, the chief executive said that around 7.5% of employees – or around 24,500 worldwide – would be laid off as HP rationalised its operations after its takeover of EDS.
Mr Caspari says job cuts in New Zealand and Australia will be in line with the 7.5% worldwide figure, and will be instigated over the three year time-frame outlined by Mr Hurd.
This article is tagged with the following keywords. Find out more about MyNBR Tags
- Clinton regains lead with post-convention bounce
- Banks don’t like tiny apartments: a flaw in the Auckland unitary plan
- Sage isn’t “relatively safe” says Xero’s UK boss
- Serious cybersecurity skills shortage sparks calls for better training
- Gaming company founder after acquisition: 'we will retain control'
Most listened to
- Business Week in Review with Grant Walker & Andrew Patterson
- NBR Radio Rich List Special: Interviews with Rich Listers, philanthropists, property gurus, investors and much, much more
- “Trevor Mallard better watch out” - Matthew Hooton
- Rodney Hide on government spending
- Michael Coote thinks Donald Trump wants to flex his muscles by humiliatingly screwing over other countries