April 3, 2020 10:30 AM, EDT

Cummins Cuts Pay, Hours in US to Offset COVID-19 Impact

Cummins plant in Seymour, Ind.The Cummins engine plant in Seymour, Ind. The changes are expected to last, at least initially, through June. (Luke Sharrett/Bloomberg News)

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Independent engine maker Cummins Inc. announced it slashed CEO pay by 50%, cut compensation for directors by 25% and lowered salaries for all other employees in the United States by 10% and 25% — and reduced working hours in response to the impact of COVID-19.

The changes are expected, initially, to last through June.

“The impact from the pandemic on the global economy has been sudden and is growing, and it is imperative for us to respond quickly to maintain our strong financial position,” Cummins Chairman and CEO Tom Linebarger said in a statement.



The Columbus, Ind.-based company will take similar actions outside the United States based on local regulations and collective bargaining obligations. These reductions in pay are intended to be a temporary measure. The company will continue to monitor business conditions and reassess the program at the end of the second quarter.

RELATED: Cummins to Lay Off 2,000 Salaried Workers

“These are difficult but necessary actions, and I know they will have a real impact on the lives of our employees and their families,” Linebarger said. “I appreciate their understanding and support as we work through these challenging times together. I want to thank our employees for their continued commitment to ensuring our customers receive the products and service they need to provide essential support to the global economy.”

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