HP slashes EDS employees salary by 30%

Hewlett-Packard, the world's no. 1 PC manufacturer, has reportedly slashed the salaries of EDS employees by 30 per cent.

HP, which bought Texas-based EDS in May 2008, reportedly termed the cuts a part of its efforts to integrate EDS' consulting business and to bring EDS' salaries closer in line with similar HP positions.

The company is said to be working on a strategy to ensure that employees in both EDS and HP holding the similar positions receive the same compensation.

According to a company statement, "As part of the EDS integration process, a project was undertaken to ensure that employees in both EDS and HP, holding the same roles, receive comparable compensation based on market rates. While pay will not be impacted for the majority of employees as a result of this process, some employees will receive pay reductions while others will benefit from salary increases."

Earlier in April, California-based HP instituted a one-month, 10 per cent pay cut for EDS employees in the US and Puerto Rico with salaries in excess of $40,000. The company had then told the employees that no permanent salary cuts are being considered.

After posting poor fiscal results in February, HP announced across the board pay cuts for all its employees in the range of 2.5 per cent to 20 per cent.

In May 2008, HP signed a deal to acquire IT outsourcer EDS for $13.9 billion, or $25.00 per share. The deal helped expand HP's IT services business and catapult it to the number two spot close behind IBM in IT services.