Vail Resorts cuts wages to save jobs
VAIL, Colorado ” Vail Resorts Inc. says it plans to reduce employee wages by up to 10 percent in an effort to cut costs and preserve jobs amid an uncertain economic environment.
The company will use a sliding scale to determine the reductions. Seasonal workers will have wages reduced 2.5 percent after the current ski season.
All others will see wages reduced effective April 2, with executives taking a 10 percent cut. Mid-level, full-time employees can expect to see four percent to five percent wage cuts.
Vail Resorts Chief Executive Officer Rob Katz says he’ll take no salary for one year, then will take a 15 percent cut. All outside board members will also reduce their annual cash retainer by 20 percent.
Also, full-time, year-round employees will receive stock incentives, increasing the number of employees owning stock from about 260 to over 2,500. The move allows many more employees to participate in ownership of the company, officials said.
The cuts are expected to save the resort about $10 million.
All parts of the mountains will remain open, and service won’t suffer as a result of the cuts, Katz said.
“We are going to open and keep available the entire mountain and the resort and all the amenities that people expect to be open,” Katz said. “People will know they are getting the whole experience, but we’re going to keep a tight lid on expenses.”
Katz said he does not expect that the resort will have trouble hiring or keeping employees due to the wage cuts. The company still offers attractive packages for seasonal employees, he said.
“They are provided medical benefits and other benefits not offered in other seasonal jobs,” Katz said. “They’re part of our family and we treat them as such. Right now is not a great market if you’re looking for a job, so from a hiring standpoint, it’s not a challenge for us at all.”
The fact that the resort is cutting wages and not jobs is a good sign, said Don Cohen of the Eagle County Economic Council.
“If they’re focusing on wage cuts versus complete job cuts, that’s good,” he said. “It’s collective pain, but you get to keep your job. It’s certainly uncomfortable, but probably a really prudent move for any company.”
Broomfield, Colo.-based Vail Resorts operates Vail, Beaver Creek, Breckenridge and Keystone in Colorado and Heavenly in the Lake Tahoe area.