Fox Corp. will cut senior executive salaries on a short-term basis in response to the coronavirus pandemic. The move was announced Wednesday in a memo from chief executive Lachlan Murdoch.
Under the new policy, Murdoch and his father, company founder and chairman Rupert Murdoch will forego taking any salary through Sept. 30. Also not taking salary during that time will be COO John Nallen, Chief Legal Officer Viet Dinh and CFO Steve Tomsic.
Over the same period, top execs reporting directly to Lachlan Murdoch will see their salaries reduced by 50%, and other execs at the VP level and above will have their salaries reduced 15%.
Roughly 700 senior-level employees will be affected by the temporary cuts.
“The most senior members of our company will be reducing their salaries so that, to the greatest extent possible, we are able to protect our full-time colleagues with salary and benefit continuation during the period we are most affected by the crisis,” Lachlan Murdoch wrote.
Earlier this year, as companies in the United States first began responding to the growing pandemic, Fox began paying all health-insurance premiums for full-time employees and waved copay. for telemedicine. The company has not instituted mass furloughs seen at other media companies. But Fox has seen its business adversely impacted by a withering ad market and a near-complete shutdown of live sports worldwide, both caused by the pandemic.
In a March 31 SEC filing, Fox warned,“While the company’s national news ratings remain strong, sports events for which the company has broadcast rights have been cancelled or postponed and the production of certain entertainment content the company acquires has been suspended. The magnitude of the impacts will depend on the duration and extent of COVID-19 and the effect of governmental actions and consumer behavior in response to the pandemic and such governmental actions.”
Read the full memo from Lachlan Murdoch:
Together, we are navigating an unprecedented health crisis. While most Americans are staying at home, I want to recognize the magnificent work you are doing to keep our neighbors, friends and families informed and entertained and our company running smoothly in this unique moment in history. Because of your effort, and the years of hard work that preceded it, we are in a strong position to weather this storm.
For those of you most affected by the virus, whether directly or through a loved one, I want to offer my deepest concern and compassion. Since the onset of the crisis our priority has been the health and well-being of our people. We took swift action to institute a work-from-home policy and have provided enhanced safety measures for those who are working on-site.
Additionally, to ease the financial burden of our employees, beginning in March 2020 we started paying full-time employees’ health insurance premiums and we have waived the copay for telemedicine. I urge you to utilize these resources. And, as has always been the case, full-time FOX employees are eligible to receive full salary continuation for up to six months, if they are on an authorized illness-related leave of absence. These steps were taken to ensure that our employees are supported during this difficult time.
While we don’t know exactly when we will return to normal and full operations across the company, we have decided to take several new actions to ensure that we remain strong and are well-positioned when this crisis recedes.
To that end, the most senior members of our company will be reducing their salaries so that, to the greatest extent possible, we are able to protect our full-time colleagues with salary and benefit continuation during the period we are most affected by the crisis.
Therefore, effective immediately, the company’s Named Executive Officers – Rupert Murdoch, John Nallen, Viet Dinh, Steve Tomsic and I – will forego our salaries through September 30, 2020. The rest of my direct-report executive team will reduce their salaries by 50% through the same period. And from May 1st through July 31st, 2020, our executives at the VP level and above will reduce their salaries by 15%. Collectively, these salary reductions will impact about 700 of our colleagues. And we are suspending compensation increases throughout the company, including for the Board of Directors.
We are taking these steps with a couple of goals in mind:
- First, we want to do all we can to continue providing your salary and benefits throughout this crisis. Your commitment to this company and its culture, many of you for decades, makes me enormously proud.
- Second, I am focused on ensuring FOX comes out of this crisis as an even stronger company that will be even better positioned to inform and entertain the country in the days ahead.
I am heartened to know that many of our fellow FOX colleagues are already doing meaningful work to help others during this time. For example, we have retained and redeployed our Studio Lot food services staff, and these colleagues are now preparing 2,000 meals per day for those in need in the LA community. And some costume department staff have used their time and skills to make masks for fellow colleagues to help them work more safely.
At the end of this correspondence are links to opportunities for you to consider, that support frontline responders and impacted areas through virtual volunteering, allowing you to safely lend a hand. These are only a few suggestions. Each of you will know of additional opportunities within your communities. If you would like to use your work time volunteering, please be in touch with your human resource manager so they can better understand what capacity you have to volunteer, and how the company can assist you in that work. I want to thank our colleagues for what they have done already to help others, and for the good work for our communities that I know is ahead.
As a company, we have a responsibility in this moment to help each other and those in need and we are using our platforms and resources to inform our viewers and to give back to our audiences. In addition to what I have mentioned above we have:
- Run more than 22,000 coronavirus-related PSAs from the Ad Council, National Association of Broadcasters, American Red Cross, The Salvation Army, and California Surgeon General
- Taped special PSAs of FOX Sports and FOX News anchors, hosts and personalities encouraging viewers to stay home and to seek the latest guidance from the Centers for Disease Control
- Co-hosted a town hall with FOX News Channel and Facebook about the pandemic and jointly donated $1 million to Feeding America’s COVID-19 Response Fund, which funded 10 million meals delivered to Americans in need
- Broadcast a multi-platform simulcast of FOX Presents The iHeart Living Room Concert for America from FOX Entertainment and raised over $13 million for Feeding America and the First Responders Children’s Foundation
- Used the FOX Sports platform and programming to support and raise awareness for charities in the fight against COVID-19. In partnership with NASCAR and MLS, FOX Sports has donated to charities including Feed the Children, American Red Cross and Feeding America. FOX Sports, in partnership with the NFL, is also contributing a portion of its advertising revenue from encore presentations of FOX NFL Super Bowls to Feeding America
- Spearheaded a variety of local on-air charitable initiatives through our FOX Television Stations, from airing campaigns benefiting food banks to partnering with teachers’ unions to presenting school lessons on television for students who do not have access to laptops or Wi-Fi during school closures
- Donated $1 million to the City of Los Angeles Emergency COVID-19 Crisis Fund, which supports meals for the elderly, offers childcare to healthcare workers on the frontline of the crisis, and provides personal protection equipment to the city’s homeless population
We will continue with many of these and other emerging initiatives where we can be helpful. At the same time, we are keeping a close eye on the unfolding crisis and its evolving impact on our business – adjusting the way we operate in the near-term, communicating with our partners, and evaluating our longer-term models – to ensure that we maintain the strength of FOX for the future.
Following the guidance of state and local officials, we are now extending our work from home policy through May 15th. As always, we will monitor and modify our approach to returning to normal operations based on recommendations from health experts and elected officials.
I know that these past weeks have been difficult for you and your family, as they have been for all of us. We are in this together, and with courage and a renewed sense of purpose, we will emerge from this challenge stronger, more grateful for our blessings and more indispensable than ever.
Sending you and your families my very best.
Please stay safe,