Every McCann New York employee earning more than $60,000 is taking a 10 percent reduction to help safeguard talent, the network’s North America president told staff in a memo on Wednesday.
Devika Bulchandani said the changes will be in effect for the “foreseeable future” and the agency will “re-evaluate as needed.”
She explained: “After much deliberation, we decided that at this moment, preserving jobs across our community of talented colleagues would be the best and right way for the agency to weather this storm.
“I continue to believe we will emerge from this crisis and the world will need what we do more than ever…at this point we just don’t know when that will be.”
However, staff reductions in other areas and markets of McCann’s business are unavoidable at this time, the network confirmed in a statement.
Salary cuts, freezes on hiring and temporary labor, major cuts on non-essential spending and furloughs are among the cost-cutting measures the agency has put in place this week.
Harris Diamond, chairman and CEO of McCann Worldgroup, said: “The current health crisis is constantly evolving, and creating significant economic impact. As we navigate through this, we are taking a series of steps to ensure we can appropriately support our clients as well as the long-term vitality of the agency.
“A variety of actions across our agencies are being implemented that include salary cuts, freezes on hiring and temporary labor, major cuts on non-essential spending, and furloughs in markets where that option is available. Unfortunately, reductions in staffing levels are also taking place in certain areas of the business.
“These are difficult decisions made in difficult times. Our goal is to service our clients while protecting as many jobs as we can, and we will of course provide as much support as possible.”
Bulchandani’s memo is in full below.
As announced at our All Hands today we will be instituting a temporary pay reduction for a majority of our people across all our U.S. agencies effective until we get back to a more normal operating environment. We will be taking similar steps around the world at all McCann offices dependent on local employment laws.
The details: Effective starting April 27th, employees earning over $60K will receive a 10 percent pay reduction (please note that no one will be dropped below an annual salary of $60K). HR will be in touch with you directly to share specifics within the next few days. This adjustment will be partially reflected in your April 30th paycheck and will be fully effective in your May 15th paycheck. These changes will be in effect for the foreseeable future, and we will continue to re-evaluate as needed.
After much deliberation, we decided that at this moment, preserving jobs across our community of talented colleagues would be the best and right way for the agency to weather this storm.
I continue to believe we will emerge from this crisis and the world will need what we do more than ever…at this point we just don’t know when that will be.
I know this is a very difficult time and I appreciate everyone’s continued flexibility, creativity and hard work in keeping McCann and our clients’ businesses running.
We will get out of this eventually — until then be safe, and thank you for all your hard work.