Maytag is hitting salaried workers with a double dose of cost-cutting, freezing their pay and asking for volunteers willing to quit to reduce the work force.
The actions come only days after the Newton-based company granted a new round of stock options to top executives.
The pay freeze applies to salaried employees throughout the company, including top executives. The freeze is necessary to reduce costs, in large part because of the need to help offset rising prices of steel and other materials, said Lynn Dragomier, a Maytag spokeswoman.
The company also is looking for salaried volunteers to quit their jobs in exchange for a separation package. Details of the package weren’t released.
The voluntary reductions are part of the company’s “One Company” restructuring announced in June and designed to put its appliance unit, its Hoover vacuum cleaner business and the Newton corporate headquarters under one umbrella.
Maytag is reducing its company-wide salaried work force by 1,100 positions, to 4,700, as part of the plan.
The request for voluntary resignations could push the final number even lower, Dragomier said.
Dragomier said the goal is overall reductions in costs, rather than a specific number of jobs.
She wouldn’t speculate on what might happen if the goal isn’t met with volunteers.
Maytag won’t say how many salaried workers it employs in Newton, but unofficial estimates put the number around 1,200.
Filings this week with the Securities and Exchange Commission show that top Maytag executives were granted stock options.
The timing is coincidental, because the board normally considers option awards in November, Dragomier said.
Ralph Hake, the company’s chairman and chief executive, was granted options on 97,000 shares at an option price of $19.88.
Dragomier said the options are long-term awards tied to company and stock performance. The options can’t be exercised before November 2007.
Options give an executive a right to buy stock at a certain price, making options a good deal if the stock price rises above the option price.
From the Des Moines Register