Kier cuts staff salaries by up to 20%

Aaron Morby 2 months ago

Kier will this week cut staff salaries by between 7.5% for lower pay grades and up to 20% for senior managers.

Davies warns that greater reductions in pay or hours may be needed to respond to activity levels
Davies warns that greater reductions in pay or hours may be needed to respond to activity levels

The pay cuts, which come into force from Wednesday, will run initially until the end of June but could be extended if the coronavirus crisis deepens.

These cuts will impact around 6,500 staff and follow the board’s announcement last week that its top executives had agreed a 20% base salary cut.

Chief executive Andrew Davies also reported this morning that the majority of Kier’s core construction sites remained open, but the board had taken the decision to close Kier Living jobs.

He also announced plans to sell Kier Living and property assets were now on hold.

“Approximately 80% of our sites or workplaces continue to operate, although we recognise that this may change,” he said.

“We continue to receive support from our major customers, including Highways England, the Ministry of Justice and various utilities providers. In line with a number of other companies in the sector, we will pause work on our Kier Living house-building sites.”

Davies said Kier had been forced to take decisive action in the face of the significant challenge posed by Covid-19.

“These decisions have not been easy to take. We recognise that these are unprecedented measures and we will keep them under review during the three-month period.”

Salary cuts banding across pay grades

• 20% cuts for staff grades S2 to M3 – senior managers, senior PM’s, QS’s, commercial managers etc, heads of departments, framework managers

• 15% reduction for grades M2 and M1 –  first-line managers such as site agents, SHE advisors, SHE managers, project managers

• 7.5% cut for grades C4 and C3 – works managers, non-working site foreman/supervisors on salary

S is strategists; M is managers;  C is contributors

In a letter circulated to staff last Friday, Davies warned that certain employees may be asked to take greater reductions in their base salaries and a reduction in working hours, depending on the level of work that remains available.

“Although the majority of the group’s sites remain open, the level of work available to a number of the group’s employees will decrease as a result of COVID-19, and further sites may need to close,” he warned.

Davies added that Kier would to using the Government’s ‘Coronavirus Job Retention Scheme’, under which employees will be furloughed, meaning that they cannot do any work for the group but will be entitled to be paid up to 80% of their salary, subject to a maximum of £2,500 per month (gross).

He wrote: “The scheme enables us to keep our valued employees who will help the group re-mobilise to full capacity in due course. If there is no work for you do (for example, because the site you are working on has closed), we will arrange for you to participate in the scheme.”

In a trading statement this morning Kier said it continued to closely manage its net debt, which remained in line with management’s expectations.

The group has total facilities of £910m, including £700m of facilities which are due for renewal during 2022.

Reported average month-end net debt was £395m for the six months to December 2019.

Latest news

SIG management blunders rack-up £112.7m loss

New boss promises growth strategy after PwC called in to investigate divisional forecasts
6 hours ago

Union calls for construction workers to wear masks

Unite demands revisions to Construction Leadership Council guidelines
1 day ago

Robertson approved to start major Blackpool hotel

Site clearance to start next week on phase 2 of £100m Talbot Gateway regeneration
6 hours ago

Failed NHS Nightingale joinery firm sold in pre-pack deal

J&P Carpentry and Joinery went into administration after working on Birmingham NEC hospital
1 day ago

Steel erection starts on first HS2 bridges

Cleveland Bridge starts erecting 65m bridge to span M42
6 hours ago

Scotland’s builders begin return to work preparations

Firms hope to be cleared to return to work from mid-June
7 hours ago

£61m infra loan to pave way for 6,500-home scheme

Local contractors to sign first deals this summer to transform Cambridgeshire site
7 hours ago

Keep the industry updated by joining the Enquirer Directory

Membership lets construction know you are open for business now or in the future
2 years ago

Vistry asks subcontractors to cut rates

House builder warns trade packages could be retendered
1 day ago

TClarke rides out lockdown and eyes £2m half-year profit

M&E boss says swift cost savings helped firm breakeven in April and May
1 day ago

Kier confirmed for £97m Heartlands Hospital job

Work to start this summer on Ambulatory Care and Diagnostics Centre
1 day ago

Costain completes £100m fund raise

Dubai contractor takes 15% stake in Costain
1 day ago

Tycoon’s £1bn flats scheme consent quashed in Whitehall U-turn

Housing secretary accused of bias in backing Richard Desmond's 1,500-flat Isle of Dogs scheme
2 days ago

First pictures of giant HS2 tunnelling machines

TBMs being manufactured in Germany before launch on site later this year
1 day ago

M&E contractors hoping to ‘hold on’ through covid crisis

Engineering services leaders urge whole supply chain to work together to survive
1 day ago

Griffiths to start £25m historic Welsh viaduct upgrade

Restoration work to start next month on 150-year-old wooden viaduct
1 day ago

Barratt subcontractor rate cut letters “sent in error”

Specialists assured that 15% rate reductions are "not company policy"
2 days ago

NHS Nightingale joinery firm goes under

J & P Carpentry and Joinery collapses weeks after fast-track NEC conversion
2 days ago

EDF seeks consent for £18bn Sizewell C nuclear plant

Project will employ 25,000 construction workers, delivering a big post-covid 19 stimulus
2 days ago

Covid-19 compliance officers keep Ballymore sites safe

Contractors can draft in virus-protection help from new specialist supplier
2 days ago

ISG secures £17m Dudley leisure centre

Work to start on delayed Flood Street area leisure centre and swimming pool
2 days ago

Construction output to plunge 25% this year

Despite a strong rebound 2021 forecast to be down 6% from last year
3 days ago

£1bn building safety cladding fund open to applicants

Residential building owners can apply for funding for remedial work on non-ACM cladding systems
3 days ago

Roads contractors told to halve accident rates

Highways England aims to build on improved site safety performance seen during covid-19
3 days ago

Keepmoat to restart work on sites across England

House builder employs 1,150 staff and supports 10,000 supply chain jobs
3 days ago

A66 TransPennine £1bn upgrade route picked

Amey/Arup JV wins £45m design contract
6 days ago

Plan in for station on £40m revived Birmingham rail line

Plan lodged for new Moseley station on Camp Hill railway re-opening project
3 days ago

Highways firm trials social distancing tags on sites

Lightweight system can be clipped on belts, lanyards or hard hats
3 days ago

Ferrovial drops Agroman name

Ferrovial Construction become major project brand
3 days ago

Button pressed on race for £25m lift framework

Specialists wanted for four-year deal across north of England
3 days ago

Contractor services