Cumulus Media CEO Mary Berner noted Tuesday in a video message distributed internally to all employees that she was “literally astounded” by their capabilities.
She gave shout-outs to those producing on-air radio programs from home, and to the sales department from shifting from in-person sales calls to “pitch perfect telesales with timely and topical proposals and products.”
With “enormous pride for everyone in the organization,” Berner revealed what Cumulus has determined will be “the straightest path” through the COVID-19 crisis. It involves furloughs, and temporary salary cuts.
With Berner and the Cumulus C-Suite “singularly focused” on protecting its employees and “our shared future” — despite coronavirus-fueled revenue losses and financial pressure — there is nevertheless a need to implement further “short-term fixes.”
These “temporary and reversible actions are clearly preferable to permanent ones for our employees, company and future,” Berner explained, with company leadership committed to “never ever thinking” of its employees “as numbers on a spreadsheet but instead as deeply valued colleagues and members of the Force Cumulus family.”
Cumulus’ short-term plan includes elements that are not easy, but are necessary, Berner said.
First, the “vast majority” — over 80% — of Cumulus’ salaried employees will take three individual weeks of furlough.
This differs from the announcement this week by broadcast TV company TEGNA that took care in noting employees would be taking one furlough week of choice between now and the end of June, rather than one week over the next three months.
The latter is what is happening at Cumulus.
Berner explained to staff, “That is unpaid leave where you cannot do any Cumulus work. You will take it in one-week installments over a 15-week period beginning April 20. These furloughed weeks will be determined in advance with your managers.”
Unspecified short-term changes to Cumulus’ non-salaried commissioned salespeople are also being made.
The furloughed approach Cumulus chose, Berner explained, “was that in nearly all cases it will allow those affected to take advantage of government benefits, thereby minimizing the financial impact to our employees, which was really important to us in our decision-making process.”
The “small remainder” of employees who fall outside the intermittent three-week furlough plan will fall into one of two groups.
First, Berner said, “people upon whom we depend for financial controls or those who don’t have someone above them or in their department who can effectively cover for them” will see a salary reduction effective April 16.
The second group of people are employees whose job functions or responsibilities “have been greatly reduced or eliminated entirely as a result of the COVID-19 impact.”
These employees, which are believed to be small, percentage-wise, will be put on a straight 90-day furlough, covering the period of April 16-July 16.
Once normal operations return to Cumulus, the furloughed employees will be brought back.
Importantly, Cumulus will continue to cover medical, dental, and vision benefits for all employees regardless of which group they fall in during the furlough period. And, Cumulus will pay the employee share of premiums for the full three months of the furlough.
“Even though these are intended to be temporary actions, I know they are going to land hard, really hard, and that is in the emotional and financial toll that a furlough or salary cut will take on each of you,” Berner said. “I am truly sorry and sad about this announcement. None of you deserves this.”
News of the furloughs and temporary salary reductions was first reported Wednesday morning by Streamline Publishing’s Radio Ink. The publication noted that Cumulus’ leadership team “unanimously decided” to take a 25% salary cut and to forego all incentive compensation for the year, which Berner said would result in average total compensation reductions for the year of over 40% for the team. Most senior leaders, including Berner, will see total salary reductions of more than 50%.
“The company is not commenting,” a Cumulus spokesperson said when asked for comment regarding Berner’s video message.
Perhaps Berner said it all in the recording.
“Today’s announcements stink, they just do,” she admitted. “But, to reiterate what I said last week, the world, our country, our communities and Cumulus Media will get through this crisis. I can not emphasize this enough, we will get through this crisis.”