TOKYO -- Toshiba has sent a request to its union to continue temporary compensation cuts implemented this fiscal year as an emergency measure, aiming to hold down fixed costs as it tries to get back on its feet after a massive loss in its nuclear power business.
The Japanese conglomerate cut managers' base monthly pay and bonuses for all employees, as well as overtime and travel allowances, for fiscal 2016 in the wake of an accounting scandal. It has asked to continue similar measures into fiscal 2017 and beyond, The Nikkei learned Thursday. The union will likely accept the request after discussion with management.
Toshiba still plans to resume hiring new college graduates in spring 2018. The company, which has suffered from a brain drain since the 2015 scandal, is also posting openings on major job-search websites for such positions as accounting and public relations staff, as well as chip engineers.
The union opted not to send wage hike demands to management Thursday for annual spring negotiations. In addition, it will not participate in industry wage talks for a second straight year.
However, given that some areas -- such as the memory business -- are still performing well, the union urgently needs to seek better compensation for employees. It will consider what demands to make at separate negotiations with Toshiba management.
Provisional earnings released Tuesday showed a 499.9 billion yen group net loss ($4.41 billion) for the nine months through December, owing mainly to a 712.5 billion yen impairment charge on U.S. nuclear operations. Toshiba's liabilities exceeded its assets by 191.2 billion yen at the end of 2016.