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Benefits January 17, 2003
Ma Bell Delays Merit Pay Hikes, Hiring
January 17, 2003 (PLANSPONSOR.com) - AT&T Corp.
has put off managers' merit pay hikes and has instituted a
management-hiring freeze because of the economy and
telecommunications industry problems.
Reported by Fred Schneyer
The roughly 30,000 employees of the long-distance carrier eligible for merit raises will get them in September instead of March, the company said, according to a Wall Street Journal report.
However, managers will get their bonuses on time in March, Chairman and Chief Executive David Dorman told employees in a memo on Thursday that outlined the changes. Dorman said the delay was a less drastic way to cut costs than canceling the pay hikes or forcing employees to take days off without pay.
Industry Woes
Like other telecommunications companies, AT&T also has been struggling with shrinking revenue and increased competition. Its customers are increasingly using cell phones and e-mail for long-distance communication and it faces powerful new rivals as the regional Bells win regulatory permission to offer their local customers long-distance service. Staying afloat in these conditions requires tight cost controls.
AT&T has announced plans to cut about 3,500 jobs this year.