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Mandatory pay cuts for everyone else in North America

Embattled AMD will cut 1,100 people and impose mandatory pay cuts on all North American employees. The figure is approximately 9 percent of its global workforce. The good news is that some of the layoffs will come through attrition, so not everyone will be seeing pink slips.

The cuts start from the top, as Executive Chairman and former President Hector Ruiz will see a 20 percent cut in his salary. Many analysts and investors blame Ruiz as the cause of the downfall of AMD, which for a time held a sales and technology lead over Intel in several key sectors. After his seventh consecutive quarterly loss, he was replaced as CEO by Dirk Meyer, who will also see a 20 percent pay cut.

Senior North American executives that are vice presidents or higher will see a 15 percent pay cut. Salaried workers will see a 10 percent cut, while hourly workers will face a 5 percent wage reduction. AMD will also halt its 401(k) matching program.

Last month, AMD took a $70 million charge after laying off 600 workers.

Longtime veterans of AMD have been longing for the good old days of Jerry Sanders, who led AMD for over 30 years. Despite going through several difficult recessions, he often refused to lay off employees, having seen the effects of layoffs that had occurred at Fairchild Semiconductor. Instead of cutting employees, he instituted efficiency programs, such as working on Saturdays and longer shifts.

AMD will also take an additional $622 million write-off on its purchase of ATI, after a $800 million impairment charge last year. AMD paid $5.4 billion to takeover ATI, which it sees as critical in its plans for Fusion products to compete against arch nemesis Intel.

Many layoffs have been announced in the last month, including Logitech, Seagate, and mighty giant AT&T. Earlier today, Circuit City announced that all 30,000 employees will lose their jobs.

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By crystal clear on 1/17/2009 2:47:53 AM , Rating: -1
Thanks to D.T. to have my comments for an "automatic rate down" the moment its posted,that saves votes for D.T. commentators to rate others down.

By crystal clear on 1/17/2009 5:34:41 AM , Rating: 2
The D.T

This below is the correct version of the story-

AMD, which trails Intel Corp (INTC.O) in the computer chip market, said the salary decreases range from 20 percent for its two top executive to 5 percent for lower level employees in North America and voluntary pay cuts in other regions.

As part of its cost cuts, it said Chairman Hector Ruiz and Chief Executive Dirk Meyer will temporarily take 20 percent salary cuts, while U.S. and Canadian executives at the level of vice president and higher will take 15 percent cuts.

North American employees who are not eligible for overtime pay will take 10 percent cuts, while overtime-eligible employees will see their pay reduced 5 percent. It is also implementing voluntary pay reduction measures for employees outside North America.

Compare the D.T. article & the above - you will see for yourself the difference.

The Reuters story is the correct version.

By Viditor on 1/17/2009 7:07:22 AM , Rating: 2
Ummm...I think it should be noted that Hector is leaving AMD very soon to head up the new Fab Co.

"Nowadays you can buy a CPU cheaper than the CPU fan." -- Unnamed AMD executive
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