Tesla is the latest carmaker to furlough all non-essential workers and cut employee salaries during the shutdown of its US facilities due to the COVID-19 pandemic.
According to an internal email seen by Reuters and sent by in-house counsel Valerie Capers Workman, Tesla is expecting to reopen the Fremont and New York factories on May 4.
Tesla, which suspended production at its US facilities on March 24, claims that furloughing non-essential workers and cutting salaries are part of the company’s efforts to manage the costs related to the shutdown and achieve long-term plans.
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Salaried employees at Tesla will receive a smaller paycheck, starting from April 13, with the cuts remaining in place until the end of the second quarter.
Tesla workers’ pay in the United States will be cut by 10 percent, while directors will receive a 20 percent cut. Vice presidents’ salaries will also be cut by 30 percent. Similar reductions will also be implemented for the company’s employees abroad.
Workers that cannot work from home, as well as those who are not assigned to critical work on factories will be furloughed but they will maintain their healthcare benefits until the facilities reopen, according to the email.
Tesla said on March 20 that it has enough liquidity to navigate through this extended period of uncertainty, having $6.3 billion in cash at the end of the third quarter ahead of the recent $2.3 billion capital raise.
The company also made headlines when it tried to avoid the coronavirus-related suspension a few weeks earlier by deeming itself as “national critical infrastructure”, but thankfully decided to shut down its facilities and not pose a public health risk in these sensitive times.
