OSAKA – The management of Panasonic Corp. has entered into talks with its labor union to slash bonuses by 20 percent this year due to deteriorating business performance, company sources said Thursday.
The company also plans to extend regular working hours by 15 minutes to 8 hours so it can effectively slash basic wages by several percent, the sources said. The struggling electronics company is also negotiating with the labor union to cut expenditures, including travel allowances and overtime pay, they said.
The measures, which are likely to take place for one year, are expected to enable the company to save tens of billions of yen in personnel costs, the sources said.
Panasonic may not be able to stick to its earlier agreement with the union to pay annual bonuses equivalent to 4 months’ wages.
As for the basic wage, the firm will maintain its seniority-based automatic wage hikes as agreed with the union, but they would effectively be reduced because of longer working hours from May.
The electronics maker expects to post a group net loss of ¥765 billion for the current fiscal year ending March, due mainly to flagging sales of its digital appliances.