- Tesla will be temporarily reducing employees' salaries and will furlough non-essential workers.
- The company made the announcement in an email sent out to employees by the company's head of North American HR on Tuesday, CNBC reported.
- According to the email, Tesla will begin implementing certain cost-cutting measures starting on April 13 and plans to resume normal production at its US facilities on May 4.
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Tesla announced to employees on Tuesday morning that it will be temporarily reducing salaries and will furlough non-essential workers as the automaker curbs its production of new cars due to COVID-19.
In an email sent out to employees by the company's head of North American HR and in-house counsel Valerie Workman, that was published by CNBC, Tesla told employees that some jobs would be impacted as it continues to keep "only minimum critical operations running."
"While we are continuing to keep only minimum critical operations running, we expect to resume normal production at our US facilities on May 4, barring any significant changes," the email said. "Until that time, it is important we take action to ensure we remain on track to achieve our long-term plans."
According to the email, the company will begin implementing certain cost-cutting measures starting on April 13. These measures include temporarily reducing pay for salaried employees, and placing employees who cannot work from home and have not been designated "critical work onsite" on furlough.
"For US employees, these reductions are 30% for Vice Presidents and above, 20% for Directors and above, and 10% for everyone else," the email said regarding pay cuts, which are expected to remain in place until the end of Q2.
"For non-U.S. employees, there will also be comparable reductions, of which the specifics will be communicated by the local leadership team in accordance with local laws and works-councils," the email continued.
Employees placed on furlough will maintain their healthcare benefits and will be eligible for unemployment benefits through their state agencies.
The email added that during this period, salary and hourly rate adjustments, as well as equity grants, will be put on hold. Tesla offered employees the opportunity to take a voluntary leave of absence.
"We continue to monitor the situation closely, and our top priority is to ensure the safety of our employees. As usual, for those who are onsite, if you are sick or are uncomfortable coming to work, please contact your manager and stay at home," the email added.
Representatives for Tesla did not immediately respond for comment.
Tesla temporarily closed its Fremont factory from March 23 following a shelter-in-place order put out in the San Francisco Bay Area to curb the coronavirus spread. Tesla also suspended most of its operations at its solar panel factory in Buffalo, New York.
A Tesla Gigafactory outside Reno, Nevada, remains open, despite the fact that a worker tested positive for COVID-19 in late March.
