The largest cruise ship company of the world Carnival announced its plans for wide spread axing of jobs and pay cuts in its efforts to cut down on costs as its business is hit by the novel coronavirus pandemic.
After implementing the job and salary cuts, the company would be able to save “hundreds of millions of dollars” over the course of the current year, said the world’s largest cruise company. The company however did not give any details of the number of possible job cuts and furloughs.
The company however clarified that its measure will impact thousands in its worker force globally. For example, in the United Kingdom, it is being expected that the company will trim down its workforce by about one fourth – at about 450 job losses, and implement 20 per cent salary cost for the rest remaining staff. More than 150,000 people are employed by the company globally prior to the pandemic crisis.
The company will trim down the pay cheque of its chief executive, Arnold Donald, by half for the rest of the current year while those of the other senior executives expected to get a reduction of pay cuts of 25 per cent. All those employees engaged in on-shore operations will have 20 per cent of their salaries slashed.
Since early March, all of its cruises had to stopped by Carnival as several of its ships became host to serious outbreaks of Covid-19, the disease caused by the novel coronavirus. That includes confirmed cases of more than 700 and 13 deaths on its Diamond Princess ship.
The company said in a statement to the stock market on Thursday that since early March, “no meaningful revenue” has been generated by the company which also owns the Cunard, P&O and Costa cruise brands.
This announcement by Carnival comes amid other travel companies also announcing major job and salary cuts. While tens of thousands of jobs have already been axed by airlines such as British Airways, all of its cruises until at least July have been cancelled by Disney.
Since the coronavirus pandemic is expected to continue and linger on, therefore cruise shipping companies expect a much lower demand than usual and hence ships will start to sail again at staggered dates to adapt to the lower demand. Carnival plans to restart its operations in August.
The job cuts had been delayed by Carnival far longer than other companies so that some financial assistance could be given to its employees, the company said, and added that it was still coughing up commissions to travel agents for cancelled cruises.
The decision to cut jobs was a “very tough thing to do”, Donald said.
“Unfortunately, it’s necessary, given the current low level of guest operations and to further endure this pause,” he said. He added that the company “look[s] forward to the day when many of those impacted are returning to work with us”.
(Adapted from TheGuardian.com)