Staff reductions, salary slashes and furloughs are taking place across Omnicom Group agencies, the CEO has confirmed.
In a memo to all 70,000 global employees, John Wren explained that leadership will be cutting their pay by a third, while he will forgo his entire salary until the end of September.
"Since my last note to you, we have solidified some of the internal measures to adjust our business to meet the changing needs of our clients. Regrettably, this will include furloughs and staff reductions across many of our agencies," Wren said in the memo. "We are doing everything we can to limit staff reductions, and to take care of those who are affected."
The CEO stressed that Omnicom has limited the number of redundancies in exchange for furloughs wherever possible. He noted that, "with few exceptions," it has stopped all new hires, frozen salaries and reduced the number of freelancers. Wren said leaders are attempting to move people from quiet business to more active parts of the network, including Omnicom Health Group.
Additionally, the holding company is eliminating discretionary costs and capital expenditures, including participation in award shows and industry events.
Below is Wren’s memo in full.
As the impact of COVID-19 continues to evolve, we are focused on protecting the safety and well-being of our people, continuing to serve our clients and preserving the strength of our business.
I have personally heard from clients around the globe just how much they value the work you are doing in their time of need. Thank you for everything you are doing, despite all the challenges.
Unfortunately, COVID-19 has had a profound impact on the economy, on our clients’ businesses, and in turn, on ours. While we hope for a swift recovery, we have to respond quickly to the reality of the moment, to ensure the sustainability of our business and our ability to continue to provide our clients with outstanding service.
Since my last note to you, we have solidified some of the internal measures to adjust our business to meet the changing needs of our clients. Regrettably, this will include furloughs and staff reductions across many of our agencies. We are doing everything we can to limit staff reductions, and to take care of those who are affected.
Where possible, our agencies will use furloughs rather than permanent reductions, so we can bring people back if, and when, conditions improve and client demand recovers.
Our agencies will participate in government subsidy programs around the world to reduce the number of permanent staff reductions we need to make.
We have expanded coverage in our U.S. health benefit plans for those affected by COVID-19.
We are actively looking to move people into areas of our business that are growing, such as Omnicom Health Group.
Omnicom’s executive leadership team, including our network and practice area CEOs, are reducing their salaries by a third, and I am waiving 100% of my salary, through the end of September.
With few exceptions, we have stopped all new hires, frozen salaries and reduced the number of freelancers we use.
We are eliminating discretionary costs and capital expenditures, wherever possible, including participation in award shows and industry events.
Lastly, we have suspended our share repurchase program, have strengthened our liquidity position through new financings, and are conserving cash wherever possible.
You are the heart of our business and that makes these actions extremely difficult. We have survived crises before. Our people and our company have shown tremendous grit and resilience and we will come out of this stronger.
Thank you for your hard work and commitment during this difficult time.
Stay home. Stay safe.
This story first appeared on campaignlive.com.