A millionaire CEO just cut his salary to make sure his staff could all get raises this year (the ones who weren’t laid off)
While the Container Store is facing some very real retail headwinds, some employees can still expect a raise this year, thanks to the company’s CEO.
Satish Malhotra has voluntarily reduced his salary by 10% to help offset costs of pay increases for others at the company. In a filing with the Securities and Exchange Commission, the company noted Malhortra’s annual salary would drop from $925,000 to $832,500 for a six-month period.
Last year, Malhotra’s total compensation came in at $2.57 million.
It was not made clear what the average increase would be for employees.
The Container Store reported an adjusted net loss of $10.1 million in its most recent quarterly results, more than $20 million worse than the same period a year ago. In May, it announced a round of layoffs that affected roughly 15% of its support center workers and 3% of the employees at its distribution centers and stores. The exact number of people affected by the cuts was not disclosed.
As part of the action, Malhotra signed a letter from the company’s chief legal officer agreeing that he did not view the salary reduction as a breach of his contract and was waiving his right to leave for “good reason” due to the temporary pay cut. Had he chosen to do so, he would have been eligible for severance benefits that include twice his base salary.
The language of the letter indicated there are no plans for the company to begin a search for a new leader.
“Thank you for your contributions to the company,” wrote chief legal officer Tasha Grinnell. “We look forward to continuing our journey together with your leadership.”
This story was originally featured on Fortune.com
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