In a bid to cut costs at its huge manufacturing facility in County Kildare, Intel Ireland- the Irish subsidiary of the US-based information technology multinational - has introduced a pay freeze for most of its 3,200-strong workforce. The pay freeze, which applies during 2003, is not expected to affect certain key technical staff.
Intel Ireland has implemented a pay freeze covering 2003 for a large proportion of staff at its manufacturing plant in County Kildare, in a bid to cut costs during the economic downturn in the information technology industry.
In a bid to cut costs at its huge manufacturing facility in County Kildare, Intel Ireland- the Irish subsidiary of the US-based information technology multinational - has introduced a pay freeze for most of its 3,200-strong workforce. The pay freeze, which applies during 2003, is not expected to affect certain key technical staff.
Intel’s move to reduce labour costs comes at a time when Sustaining progress, Ireland's proposed new national partnership agreement between the social partners (IE0301209F), provides for pay rises of 7% over 18 months in the private sector. Intel does not recognise trade unions, and is not party to national agreements. However, most non-union firms are cognisant of pay movements across the economy generally and would use the national agreement as a benchmark.
The Intel pay freeze follows a compulsory 16-day Christmas break in 2002, known as a 'warm-down', which allowed the company to save on staff costs and on variable costs such as transport, security and training. This was the first time that a warm-down of this duration had taken place at Intel Ireland.
Despite the wage freeze, all grades of staff at Intel will receive their stock options, as well as a performance-related bonus. Recently, the stock options scheme was changed to make it more attractive. Staff will now be able to receive payments in four phases from 2004-8, whereas previously they were not entitled to avail of the scheme until 2008. The performance-related bonus for 2002 amounts to approximately 6% of salary. This will consist of a 4.5% bonus from an employment cash bonus scheme, as well as a sum equivalent to 1.66% of salary through another employee bonus scheme. These bonus awards were announced in January 2003, and are linked to company performance. Significantly, despite the continuing drive to cut costs because of the downturn in the information technology industry, Intel recorded good fourth-quarter profit figures at the end of 2002.
Eurofound doporučuje citovat tuto publikaci následujícím způsobem.
Eurofound (2003), Intel implements pay freeze, article.
