Vivo arm sends memo on 50% pay cut

It’s an internal letter, no final decision yet, says the firm

The extended lockdown and zero sales for nearly two months have impacted the finances of Vivo, the country ’s second-largest smartphone firm by market share volume, which is now struggling to pay salaries to its employees.

For instance, Joinmay Electronics — a Vivo group entity that operates in western India — informed its employees, through an internal letter, that the lockdown extension had severely impaired its ability to pay salaries. Director Ding Zhijie said the firm was forced to implement “pay cuts for all employees beginning May 2020.

Accordingly, for the month, employees will draw

a salary equivalent to 50 per cent of their gross monthly salary ”.

“With the announcement to continue the lockdown in May and a probability of further extension, means there will be no sales or collection in May too. Under these extreme circumstances, the [survival] of the company is critical because, if the company survives, our jobs survive,” Zhijie told employees through the letter.

When contacted, a Vivo India spokesperson said the letter was prepared as an internal memo and was not intended for circulation. “There is no final decision that has been taken yet,” he said, quoting Zhijie.

The firm managed to tide over the challenges in March and April, when despite “negligible sales and collections”, it paid 100 per cent salary to employees. Now, “it is impossible for our company to survive this crisis without sacrifices from each and every one of us,” he said.