Monday, February 16, 2009

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Unilever freezes salaries (including CEO's)

Consumer goods heavyweight Unilever is reported to have frozen the salaries of its management including new chief executive Paul Polman from January 1, as part of a larger programme to rein in costs. The company has intensifed cost-cutting measures in 2009, attributing the move to an uncertain trading outlook for the next two years.


Unilever said trading conditions in the US and Latin America worsened in the fourth quarter. It derives over 44% of its revenue from developing countries. HUL, the Indian subsidiary, has also called for a similar severe cost-cutting programme but refrained from announcing any freeze on pay hikes.

HUL has instead stated that a higher proportion of its salaries of its employees in 2009, will be variable pay as part of performance-driven compensation. HUL is also shifting a large part of the costs from fixed to variable in an uncertain market scenario.

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