• Kyodo News

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Toshiba Corp. plans to freeze wages for the first six months of the business year that starts April 1 in light of its rapidly deteriorating earnings, industry sources said Tuesday.

Toshiba told its labor union of the plan to freeze regular wage hikes based on its pay scale and that it wants to reject the union’s demand to raise the pay scale’s level by ¥4,500 per month, the sources said.

Companies set a pay scale, or a table for basic wages, that provides for automatic wage increases for certain workers every year, based on seniority and length of service.

A worker on the scale is supposed to get a pay hike at the start of each new business year. Toshiba’s plan would freeze that.

Toshiba is the first major electrical appliance maker rumored to be planning such a freeze. It expects to log a group net loss of ¥280 billion for fiscal 2008 on losses from its recession-battered semiconductor division.

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