GMR Group cuts employees’ salary by up to 50% due to COVID impact
MUMBAI: Battling against challenges in the wake of the COVID-19 pandemic, persified conglomerate GMR Group has revised downwards employees’ salary by up to 50 per cent with effect from May, a source said. The reduction in compensation is maximum at the highest level, the source added.
The Bengaluru-based infrastructure major has presence in roads and highways, energy and airport sectors.
“As part of the revised structure, the group has done away with the variable component in employees’ CTC (cost to company) and replaced it with special performance allowance, which will be treated as a special variable component,” the source told here.
This would result in a salary reduction of up to 50 per cent for various categories of employees, including senior and top management, effective May 2020, the source said.
Responding to an e-mail query, a GMR group spokesperson confirmed the development saying the employees’ compensation has been restructured.
“In view of the challenges faced by the infrastructure sector/industry due to COVID-19, GMR has taken steps to restructure the compensation of employees. A special variable component linked to business performance has been introduced to align with current market conditions,” the spokesperson said.
A recent industry report has forecast that airports worldwide are expected to see a decline of more than 4.6 billion passengers and revenue totalling USD 97 billion (around Rs 7.3 lakh crore) in 2020 amid the coronavirus pandemic.
The Airports Council International (ACI), which is the apex body of the global airports, also estimates a reduction of over two billion passengers at the global level in the second quarter of 2020 and more than 4.6 billion passengers for all of 2020.
The decline in total airport revenues on a global scale is estimated to be USD 39.2 billion in the second quarter and more than USD 97 billion for this year, according to the ACI.
Besides operating Delhi and Hyderabad airports, the GMR group also runs Mactan Cebu International Airport in partnership with Megawide.