With businesses and economic activity almost halted for over a month now amid the coronavirus crisis and the nationwide lockdown, around 36 per cent companies in India are considering a freeze in salary hikes to manage their costs, according to a report by Korn Ferry.
In India, the most commonly implemented measures for rewards and benefits are promotion and salary hike.
The report said that 23 per cent organisations have suspended the promotion increases and 18 per cent organizations deferring ordelaying salary increases.
The Korn Ferry report said: “36 per cent of organizations have implemented or are considering implementing a salary freeze to manage costs.”
The report by the global organisational consulting firm noted that given the government’s extensive requests on avoiding laying-off employees, majority of the companies, around 84 per cent have not implemented or are not currently considering permanent staff layoff or redundancies.
Commenting on the survey, Roopank Chaudhary, Client Partner, Korn Ferry India said: “Given the current circumstances and uncertainties on the recovery for market conditions, business leaders are trying everything to survive this storm and manage their costs.”
“Among the dozens of ways organisations are taking are layoffs, hiring freezes, reduced hours, less reliance on contractors, reducing overtime, delaying bonuses or merit increases, suspending certain benefits like retirement savings/capital accumulation programs, and many others”, he said.
He said that communicative and action-oriented leadership is of utmost necessity during this period to make people feel secure and taken care of, and helping the workforce remain focused on preserving operations as best as possible as the outbreak spreads.
Managing the challenges of this global pandemic will require innovation and agility amidst unprecedented uncertainty and business leaders will need to balance between implementing short-term measures to address immediate impact and keeping a long-term view on future growth, Chaudhary added.