AT&T freezes salaries of 120,000 managers, Cheif Executive forgoes bonus

AT&T Inc Chief Executive Randall Stephenson will forgo his 2008 bonus payment, and the company will freeze the salaries of 120,000 managerial employees this year, as the telecommunications company prepares for a grim year.

Stephenson's decision, which he sent to employees in a memo on Friday, comes after the largest U.S. phone company said in December that it would cut 12,000 jobs, or 4% of its workforce.

"Randall Stephenson today asked the AT&T Board that he not be awarded the bonus he earned based on last year's performance against the targets set," AT&T said in a statement sent by a spokesman.

Stephenson's annual bonus target generally accounts for more than 25% of his total compensation, AT&T said, without giving more details. In 2007, his bonus was $4.5 million, according to a company filing with U.S. regulators.

"We are committed to doing all we can to help preserve and protect jobs, and this is one way to do it," AT&T said. "It was not an easy decision, but it's the right one given the environment."

Stephenson is the latest in a group of executives who have lowered or given up their bonuses as millions Americans have lost their jobs in recent months.