Nearly 2,000 workers at Acxiom Corp. have taken voluntary pay cuts averaging 5.5 percent in a move to save millions of dollars, the software company announced Thursday.
In exchange for the pay cuts, workers will receive two-for-one stock options that become vested in about a year, said the Little Rock, Ark.-based company.
The customer data integration software maker employs about 6,000 people worldwide and on March 30 warned of lower-than-expected quarterly revenue and earnings.
The voluntary cuts in pay didn't prompt any management guarantees that there won't be any layoffs, but "the voluntary cuts make it less likely there will be layoffs," said Acxiom spokeswoman Alison Melson. She was paraphrasing internal remarks by Acxiom company leader Charles D. Morgan.
The voluntary cuts are in addition to a mandatory 5 percent pay cut for most of the workers. The total in voluntary and mandatory cuts will result in a US$23 million reduction in current payroll. Acxiom, which had $1 billion in revenue last year, wants to cut $70 million from its current fiscal year expenses.
Craig Heathscott, a human resources employee at Acxiom decided to take an 11 percent voluntary cut beyond his 5 percent mandatory cut. "I just see it as a great opportunity for my future and the future of my family," said the father of two young children. His wife is a schoolteacher.
"There's always a risk in the stock market, but working at this company I know we're going to rebound," said Heathscott, 33.
Heathscott said "definitely I think the overall economy will turn around or I wouldn't have taken 16 percent from my family" to invest.
Of the 700 workers not eligible for the mandatory cuts (including foreign workers and those making less than $25,000 a year), about 20 percent lined up for voluntary cuts in return for stock options, Melson said.
The average worker at Acxiom is 37 years old and the average tenure is 5.4 years. The maximum voluntary pay cut allowed was 15 percent, and some employees sought that much, she added. The voluntary cuts are worth a two-for-one stock option match, and the price of the options was set at $13.325, based on the stock's price yesterday.
Acxiom has been listed for three of the past four years as one of Fortune magazine's 100 Best Places to Work and ranked in Computerworld's Top 100 Places to Work in IT last year.