Mukesh Ambani to forgo compensation as Reliance cuts salaries upto 50 per cent

Asia’s richest man Mukesh Ambani has decided to forgo his entire compensation as the Reliance Industries Limited has decided salary cut for their employees in its hydrocarbon division due to coronavirus crisis. In a letter to its employees, Reliance said, “The COVID19 pandemic has posed unprecedented challenges for India and the world. All societies, industries and businesses are impacted, and reliance is no exception.”

According to the letter, effective from April 1, Chairman Mukesh Ambani won’t take any compensation whereas the board of directors, including executive directors, executive committee members and senior leaders, will forgo 30-50 per cent of their compensation. Employees with a salary of more than Rs 15 lakh per annum will have a deduction of 10 per cent while employees with a salary of less than Rs 15 lakh per annum will remain unaffected.

“The hydrocarbon business has been adversely impacted due to a reduction in demand for refined products and petrochemicals. This has of course put pressure on a hydrocarbons business necessitating optimisation and cost reduction across all fronts. The situation demands that we maintain a razor-sharp focus on operating cost and fixed costs and all of us need to contribute to making this happen,” reads the letter.

Annual cash bonus and performance-linked incentives that are usually paid in the first quarter of the year have also been deferred by the Reliance.

“We will closely monitor the economic and business environment, re-evaluate our response to the situation on a continuous basis and strive to improve the earning capacity of our business,” reads the letter.

Prime Minister Narendra Modi had earlier urged industries to ensure employees don’t lose jobs during the lockdown.