BT to freeze salaries of all employees

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BT will freeze the pay of all employees this year, including its most senior executives, the telecoms giant announced yesterday.

The firm, which employs more than 100,000 people, blamed the "tough economic climate" for the decision, which follows a series of similar moves by other firms, notably in the motor industry.

A spokesman said: "This has not been an easy decision but, given the tough economic climate, it is important BT meets these challenging times head on. Our unions have always been pragmatic in recognising the challenges that face BT, and so we hope they will support our efforts to ensure BT remains a healthy and sustainable company for many years to come."

The company made no general announcement about the move but said in a message to staff: "After very careful consideration, we have reviewed the need for a pay increase this year and have decided there will be no pay rises. This applies to all UK employees. Arrangements for countries outside of the UK will be advised locally.

"This is not a decision we have taken lightly. We have carefully considered current economic conditions, the pressures the business faces, the UK's Retail Price Index, and concluded it is the right thing to do.

"This year RPI is expected to go negative which means that prices are actually falling.

"While this is very unusual, we are living in unusual times."