Tata Group's top rung would take salary cuts for the first time in the history of Tata Group. CEOs and MDs of Tata Steel, Tata Motors, TCS, Tata Power, Trent, Tata International, Tata Capital and Voltas as well as Tata Sons Chairman N Chandrasekaran are some of the companies top officials to undertake an estimated 20 per cent cut in compensation. The leadership of the conglomerate aims to lead by example and motivate employees and their group organisations as well as ensure business viability.
TCS, Tata Group's most profitable company was the first to announce a pay cut for CEO Rajesh Gopinathan. Indian Hotels said that its senior leadership would contribute a percentage of their salary this quarter to help the company, as mentioned in a report in The Economic Times. The cut would primarily be in the current year's bonuses, mentioned the daily.
A Tata Steel spokesperson said that remuneration decisions are taken by the remuneration committee of the board of Tata Steel. The spokesperson said that it might not be appropriate to pre-empt a way forward.
This move comes after several reports stated that Tata Group might cut the salary of some of its employees as it saw a slump in revenues. Indian Hotels (Taj), Tata SIA Airlines (Vistara) and Tata Motors are some of the companies that might be affected by the paycut.
CEO remuneration of the top 15 Tata Group companies rose around 11 per cent from FY18 to FY19. Chandrasekaran received a total remuneration of Rs 65.52 crore, up 19 per cent, for FY19 including a Rs 54 crore commission on the profit of Tata Sons, stated the daily. TCS CEO Rajesh Gopinathan's remuneration dropped 16.5 per cent to Rs 13.3 crore in the fiscal year ended March 31. He had earned Rs 16.04 crore in the previous financial year. It must be mentioned here that except for TCS, no other Tata company has published its FY20 annual report so far.