The Canadian exhibition giant, which has shuttered its theaters, has around 13,000 employees nationwide.
Canadian exhibition giant Cineplex on Monday said part-time employees will be temporarily laid off and full-time employees will take steep pay cuts to keep their jobs after nearly 1700 screens nationwide were shuttered amid the coronavirus pandemic.
The circuit, which operates 165 cinemas with 1,695 screens nationwide and has around 13,000 employees, also said its top executives will take around an 80 percent cut in their annual base salary. The moves follow Cineplex on March 16 shutting down all of its locations, initially until April 2, amid the COVID-19 outbreak for social distancing.
"From the onset of the COVID-19 pandemic, our primary focus has been the health and safety of our employees and guests. With the temporary closure of our network of entertainment venues and the majority of our full-time employees working from home, our focus was able to shift to safeguarding the long-term stability of our business and our readiness to return once the crisis has passed," Cineplex said in a statement received by The Hollywood Reporter.
Part-time employees temporarily laid off are being offered a lump sum payment equal to two-and-a-half weeks pay if they don't qualify for federal unemployment insurance, and most do not. Part-time staff will be offered the chance to be rehired when Cineplex resumes operation of its nationwide network of theaters.
Cineplex is also offering full-time staff salary pay cuts that correspond with their job title to avoid temporary layoffs. "As the COVID-19 situation continues to evolve, we will continue to take their lead — and that of the health authorities — and we will reopen our theatres and entertainment venues when they tell us it is safe to do so," the chain added.
The temporary cost-cutting will also help Cineplex meet debt conditions for its pending $2.1 billion, $34-per-share takeover deal with Cineworld Group.
"In response to declining attendance and certain government-directed shutdowns of places of public gatherings including theatres, Cineplex is managing its business to reduce expenses in an amount necessary to offset declining revenues so that Cineplex is supporting its business and would be in a position to satisfy the debt condition," Cineplex told investors in a March 16 letter.
The Canadian company said it still hoped to satisfy all conditions to close the Cineworld Group transaction by June 30.
