Wauwatosa-based Briggs & Stratton Corp. is cutting the pay of salaried employees by 25% to 30% and halting its 401(k) match as it seeks to control costs amid the coronavirus pandemic.
In a memo to employees, Briggs chairman, president and chief executive officer Todd Teske said the company considered other options, including furloughing employees and having them collect unemployment or having a small group of employees work.
“We decided that keeping the team together through this difficult time is paramount, as we need to be agile and ready to ramp back up at a moment’s notice,” Teske's memo said. “We want our team members to be able to earn a salary far in excess of what governmental assistance provides. And we want to continue to be a viable organization where employees can continue to work and earn their livelihood for the long-term.”
Briggs & Stratton initially disclosed pay cuts on Friday for Teske and other top executives totaling around $1 million on an annualized basis. The filing also disclosed a wage reduction plan for other salaried employees.
BizTimes later obtained a copy of Teske’s memo to salaried employees and confirmed details with the company.
Those details included a 30% cut for employees above pay grade 10 and a 25% cut for other salaried employees. If the cuts would take an employee’s wage below the minimum to be considered exempt, in most cases $35,568 annually, then the employee will be paid the exempt amount.
Teske also told employees the company would monitor the situation and hopes to adjust the reductions in June. Given the level of uncertainty surrounding the coronavirus, a decision likely wouldn’t be made until mid-May.
A spokesman noted that as an “essential business” the company is continuing to ship products across its businesses but with difficulty forecasting demand in the coming months it wanted to be pro-active for the good of the business and employees.
Briggs & Stratton isn’t the only company having to make tough decisions about its workforce. Menomonee Falls-based Kohl’s Corp. is temporarily furloughing store and distribution center employees after extending the closure of its stores and Milwaukee-based Harley-Davidson suspended production at its U.S. plants, putting workers on furlough with health benefits.
Statewide, 24,664 initial unemployment claims were filed Monday alone. Nearly 222,000 have been filed since March 15, an average of 13,864 per day.
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