Salary cuts no longer necessary: Aon
Aon has backed away from plans to reduce the salaries of around 70 percent of its staff.
Aon had indicated that salary cuts of around 20 percent would be necessary if it was to avoid making redundancies. However, after conducting analysis over the past four months, Aon said the cuts are "no longer necessary to meet the commitment to our 50,000 colleagues that no one at Aon is going to lose their job because of this COVID-19 outbreak".
However, senior management, including Greg Case, Aon’s chief executive, as well as Christa Davies, Eric Andersen, John Bruno and Tony Goland, will still see their pay reduced by 50 percent. This paycut will also affect the board of directors.
From July 1, staff at Aon will go back to their original salaries, with staff being repaid in full for the salary they lost in recent months, plus an additional 5 percent of the withheld amount.
Case said: “We took decisive action from a position of strength to protect every Aon colleague against the worst case economic scenarios from this pandemic.”
Aon insisted the decision was not related to any change in the firm’s financial performance or expectations. Rather, it reflected the broker’s expectation that the risk of the pandemic developing according to its worst case scenario forecasts had decreased significantly.
Meanwhile, the business has been resilient during the crisis, Aon, said.
Aon said it will continue to pursue expense discipline and pause share buybacks and new merger and acquisition activity.