Two Major Employers Announce Cuts To Stave Off Financial Impacts Of COVID-19
Two major Kentucky employers, Baptist Health and the University of Louisville, announced furloughs and pay cuts Thursday, as the institutions grapple with the financial impacts of the pandemic.
Baptist Health Furloughs and Cuts
Baptist Health sent out a news release Thursday saying employees in jobs that "do not support caregivers or are not critical to clinical operations related to COVID-19" will be put on unpaid furlough.
“Like other hospitals across the country, Baptist Health is striking a delicate balance between maintaining a strong front line of skilled caregivers to battle the COVID-19 pandemic, while grappling with the resulting drain on resources,” Baptist Health CEO Gerard Colman said in a written statement.
At the same time, Baptist said the state’s ban on elective surgeries and diagnostic tests has slowed standard business operations.
The eight-hospital system says the furloughs will apply to both full and part-time employees in hospitals, the Baptist Health Medical Group and the corporate headquarters.
"Some will have a reduced work schedule while others will not have any job responsibilities during their furlough," the release reads.
Furloughed employees can apply for unemployment and will still be eligible for medical benefits, according to the release.
The health system did not say how many employees would be impacted, or when the furloughs would end.
According to the statement, some of the highest paid employees will be taking pay cuts. "Top leaders," including hospital presidents and corporate office leaders will be taking a 20% temporary salary cut. Other leaders, including vice-presidents and executives will be taking a 15% temporary pay cut.
Baptist Health employs about 19,500 people in Kentucky and surrounding states, according to its website.
University of Louisville Furloughs and Cuts
In an email Thursday, U of L president Neeli Bendapudi announced furloughs, a hiring freeze and salary cuts. According to the statement, the university is projecting a $40 million hit from the impacts of COVID-19 for this fiscal year, "unless we take immediate, strategic and necessary steps to resolve it.”
Like Baptist Health, the university is suffering financially from a lack of elective medical procedures at U of L Health, as well as a canceled NCAA March Madness tournament, and lower tuition rates as classes move online.
The university said it’s putting some full- and part-time employees "in targeted areas" on furlough over the next several weeks, but didn’t say how many employees will be impacted.
They’re also instituting a hiring freeze, except in "the most critical positions."
Additionally, employees earning more than $100,000 will see temporary pay cuts through at least June 30. The scheduled pay cuts are as follows:
- 10% pay reduction for any university employee with total compensation $300,000 and greater;
- 5% pay reduction for any university employee with total compensation between $200,000 - $299,999;
- 2% pay reduction for any university employee with total compensation between $100,000 - $199,999
Additionally, the statement said the U of L Athletics Association will try to mitigate a $2.1 million shortfall by cutting salaries of head coaches and senior-level administrators through June 30, 2021.
According to a university spokesman, U of L has around 7,000 employees.