Due to the COVID-19 coronavirus pandemic, employees across Union Pacific will be furloughed over the coming months.
Citing an "unprecedented drop in volume due to COVID-19," Union Pacific President and CEO Lance Fritz on Tuesday announced four months of furloughs and executive pay cuts. “Many of our customers have reduced or halted production and overall freight transportation has declined dramatically."
According to an email from a Union Pacific spokesperson, every "non-agreement" employee, employees not represented by unions, will be required to take a week off without pay each month from May to August.
In addition, executives and members of the board of directors will take a 25% pay cut for the same duration, the email states. "Union Pacific has enacted several cost-saving measures, but they are not sufficient to offset the significant decline in volume."
Fritz says the furloughs and pay cuts will meet the railroad's short-term needs. The CEO also said that UP has reduced hiring, canceled its 2020 summer internship program and has cut nonessential spending through the end of the year.