Agilent restores full pay to 37,000 employees

Agilent Technologies Inc. announced yesterday that it will restore full pay to its employees beginning Aug. 1, after imposing wage cuts more than a year ago.

The company will reverse the cuts because it recognized the impact they have had on its 37,000 employees, said Michele Drake, a spokeswoman for the Palo Alto, Calif.-based company.

“For over a year, they have worked hard, and we recognized the sacrifices they are making,” Drake said.

Drake said Agilent made the pay cuts because the economic downturn had put pressure on the company. It still hasn’t returned to profitability and doesn’t expect to do that until October. But Drake said that didn’t affect the company’s decision to restore the pay.

Agilent’s 18,000 workers in the U.S. took a 10 percent pay cut in May 2001. In February, the company restored 5 percent of that cut to nonmanagers.

Due to local laws and other regulations, Drake said she didn’t know how the pay cut was implemented in Agilent’s overseas offices.

Staffing expert David Weldon, based in Stoneham, Mass.-based, cheered Agilent’s decision.

“I think their move is very smart. When you reduce salaries to your employees, it comes at a very high price in employee loyalty,” Weldon said. “Employees don’t like to backtrack on careers and benefits, and when you cut pay, you essentially turn the clock back on them.”

Weldon said the other problem with pay cuts is that employees know from that point on, if they want to advance in terms of salary and benefits, they have to work elsewhere. And while the job market may be down now, it won’t stay that way permanently. So when times turn around, employees will remember the cut and that might cause them to leave.

According to company statements, Agilent lost $112 million in its second quarter ended April 30. The diversified technology company, which makes scientific and analysis equipment as well as semiconductor products, saw orders rise slightly in the first and second quarters. This reversed a trend of five quarters of declining orders.

Drake said the company has clients in a number of industries, including health care and the embattled telecommunications industry.

The company was spun off from Hewlett-Packard Co. in November 1999.

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