GM Has Temporarily Cut its Workers Pay Amid Coronavirus Outbreak

The coronavirus pandemic has led to many layoffs and salary cuts and the latest company to give its employees bad news is GM.

According to a list of actions announced by the company obtained by CNBC, GM has temporarily cut the salary of roughly 69,000 workers by 20% amid the coronavirus outbreak. The reduced pay began on Wednesday and will be repaid later to the employees in a lump sum with interest, no later than March 15th of 2021.

Automobile maker Ford Motor also told its top 300 executives that it will defer 20% to 50% of their salaries.

GM has also said that about 6,500 U.S. employees who cannot work from home will go on paid leave, which the company is calling a “salaried downtime paid absence.” The workers will receive 75% of their pay, keep seniority and retain health benefits.

GM executives are also taking cuts of 5% or 10% to their cash compensation, excluding bonuses, stock options or other incentives. The GM board will take a 20% reduction in total compensation.

“GM’s business and its balance sheet was very strong before the COVID-19 outbreak and the steps we are taking now will help ensure that we can regain our momentum as quickly as possible after this crisis is over,” the company said.

Shares of GM closed Thursday up 5% to $22.56.

Disclaimer: We have no position in General Motors Company (NYSE: GM) and have not been compensated for this article.