I read an interesting article in the Wall Street Journal about cost cutting moves that FedEx is taking during these trying economic times. FedEx’s cost cutting moves are as follows:
1) FedEx is lowering executive compensation. The CEO is taking a 20% pay cut and executives are taking a pay cuts from 7.5% to 10%. Executive bonuses are being eliminated.
2) FedEx is suspending matching contributions for the company’s 401(k) plan. The company is trying to avoid massive layoffs by using matching funds to pay employee salaries.
3) FedEx is implementing a hiring freeze and cutting back on variable compensation. Another attempt by the company to save jobs.
I wish more companies would follow the example of FedEx. FedEx is cutting from the top down. I have no problem with companies tightening their belt when everyone participates in cost cutting. Management and labor are both suffering salary reductions and cutbacks together. Too many companies eliminate employees positions with executive management suffering no loss whatsoever in compensation.
FedEx is setting a good example by asking everyone to make sacrifices so that the company can stay afloat. FedEx is even considering canceling an advertisement for the Super Bowl because they believe that it would not look right to spend more when employees are taking cuts. I wish that more companies felt this way.
Photo by Alaskan Dude
I love positive posts like this! Thanks!
Good move Fed Ex..Thanks for the info
I am very thankful for FEDEX,not only what they are doing for our economy,but also taking care delivering packages in one piece to the customer.I think everyone should make the move to FEDEX. In my opinion they are a reliable company.
Whats 20 percent of 22million? Dudes not taking very hard I promise you. Though I see this as a step in the right direction and applaud FedEx for doing so, I am not blinded by the fact that at the end of the day where the employee once had matching compensation to their 401ks, now they don’t and the CEO is still making millions. Could take a couple mill and still compensate the employees that are (for example) employee of the month which would give more incentive to work harder, but whatever, it is a start.