Reading time ( words)
The impact of the COVID-19 pandemic on the health of our communities and the global economy has been swift and unprecedented. Virtually no industry has been untouched by this crisis.
Commercial aerospace has been particularly hard hit. Airline travel in the U.S. alone is down 96% and we are seeing similar trends globally. Our commercial business partners have begun dramatically scaling back on their operations in order to preserve capital and protect the long-term needs of their businesses, and now we must do the same.
Beginning June 1, and continuing through year-end, Raytheon Technologies will institute a temporary 10% pay reduction for all salaried employees across our corporate offices (including Global Enterprise Services), and our Pratt & Whitney and Collins Aerospace businesses. Affected employees will be given an added 15 days off this year, with dates designated by each respective business and function leader. I have volunteered to the Board to reduce my pay by 20% for the same period.
Additionally, based on the decrease in customer demand, our Pratt & Whitney and Collins Aerospace businesses will implement furlough programs across their operations for hourly employees, which will vary by country and site, factoring in customer needs, local regulations and collective bargaining agreements. Respective business site leaders will be communicating these plans directly with employees at each site. Hourly employees in those businesses will be part of the furloughs but will not be impacted by the temporary reduction in pay.
Raytheon Intelligence & Space and Raytheon Missiles & Defense will not be included in these actions. As the vast majority of these businesses align to the industrial defense base, these parts of our company have a duty to stay fully operational to serve the critical needs of the U.S. Department of Defense and its allies. The robust strength of these segments of our business will help shield the company overall as we manage through this complex business environment.
I recognize that this puts a burden on all of you, and your families, and increases the feelings of uncertainty we are all experiencing in this unprecedented time. However, these are temporary measures that we must take to responsibly manage the company through the business repercussions of the COVID-19 pandemic.
The leadership team continues to monitor the environment, and respond with immediate actions and near-term plans as needed to ensure the safety and wellbeing of our employees. We are taking today’s actions to preserve jobs and mitigate long-term business impact.
As we work through this crisis, we can be confident that our global team, our partners and our communities will emerge stronger — and our business and the commercial aerospace industry will once again thrive. Raytheon Technologies is a diversified aerospace business with the scale and operational strength to adapt in these challenging economic times. As one company, we are stronger together.
I thank each and every one of you for your dedication to our business and our customers.