KOLKATA: ZTE Corporation, China's second-biggest telecom equipment maker by revenue, has deferred plans to slash salaries in India by up to 20% following stiff resistance from employees, company executives aware of the development told ET.
ZTE India's board had on August 20 proposed a temporary 20% pay cut for senior Indian executives drawing a fixed monthly salary of more than Rs 1.5 lakh and 12-20% cut for expat Chinese employees, according to internal documents reviewed by ET. The move was aimed at optimising resources in a challenging market where mobile phone companies have applied the brakes on infrastructure spending.
The decision to cut salaries was taken on the directions of the parent company to "reduce expenses in India since the company is running through tough times," according to a certified copy of the ZTE's India board meeting resolution.
"A majority of the ZTE India employees who would have been impacted by the August 20 board decisions have not given their consent to the proposed salary reductions since the company has not even paid performance bonus this year," said a top company executive.
ZTE India refused comment on queries raised by ET on the employee resistance to the proposed salary cuts. The company, however, said that its India management team had agreed to contribute a portion of their salary in the larger interest of the organisation.
"The key management team of ZTE India has agreed to contribute a part of their salary in these challenging times," CEO Cui Liangjun told ET, adding that this contribution would be temporary since the salary would be restored once the telecom gear market bounces back.
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