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CLSA staff asked to take pay cut

Hundreds of senior staff at one of Asia’s top brokerages, CLSA, have been asked to take a pay cut of up to 25 percent in a bid to avoid redundancies, a spokeswoman said yesterday.

A total of 500 senior brokers, analysts and managers at the Asian brokerage unit of French bank Credit Agricole were last week asked to participate in the scheme, said Simone Wheeler, CLSA’s Hong Kong-based spokeswoman.

“This is our first line of defense in terms of having to reduce costs without reducing staff,” she said.

Employees had until Monday to confirm whether they were willing to take a pay cut of 15 percent, 20 percent or 25 percent for next year.

If the company hits monthly targets, staff will be repaid the amount they gave up plus a bonus depending on the success of cost-cutting measures, Wheeler said.

However, the scheme is not compulsory and those who decline will not be penalized, she said.

CLSA, which is headquartered in Hong Kong but has operations across Asia, said it was yet to confirm the number of staff who had volunteered for the cuts.

The company implemented a similar scheme during the SARS crisis in 2003, when Hong Kong’s economy was buffeted by worries over the deadly disease.

Despite the salary reductions, Wheeler said staff morale was good.

“CLSA staff own 35 percent of company shares so there is a sense of being in the same boat and wanting to do what was possible to prevent job cuts,” she said.

One Hong Kong-based staff member who wished to remain anonymous said the pay reductions had been accepted to avoid similar cuts to those announced at US bank Goldman Sachs, which last week said it would lose 10 percent of its workforce.

“I think most people appreciate that CLSA prefers to have people sacrifice a bit so that cuts are minimized. I feel much better about my job security here than I would with one of our competitors,” he said.

However, Wheeler said job cuts remained a possibility.

Under the scheme, those opting for a 15 percent cut could receive a bonus equivalent to 8 percent of that month’s salary, while those who opt for 20 percent or 25 percent may receive an additional 17 percent or 25 percent.
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