In Tata Group’s history, this is the first pay cut. The top brass of the group may go for a 20 per cent pay cut. The chairman of Tata Sons and CEOs of all operating companies will take this cut.
The decision has been taken as the group adopts various cost-cutting measures and is also aims to motivate employees and organisations and ensure business viability, according to a report published in .
The group’s most profitable company, TCS, was the first to announce a cut for CEO Rajesh Gopinathan. Tata Group’s Indian Hotels has already said its senior leadership will contribute a percentage of their salary this quarter to help with the survival phase of the company.
CEOs and MDs of Tata Steel, Tata Motors, Tata Power, Trent, Tata International, Tata Capital and Voltas, among others, will opt for reduction in their compensation.
The cut is expected to be for the current year bonus. Meanwhile, in the report, a Tata Steel spokesperson said, “Remuneration is a decision which rests with the remuneration committee of the board of Tata Steel. It therefore may not be appropriate to pre-empt a way forward in the matter.”
According to a CEO, “We will do all that it takes to ensure right leadership with empathy. As a culture, the group has always ensured employees down the line are protected as much as can be.”