Dell to cut staff benefits in COVID-19 response

Vendor to halt 401(k) contributions to retirement plans, freeze internal promotions and external hiring

Dell plans to cut some staff benefits including pay rises, promotions and 401(k) contributions as it looks to emerge from the COVID-19 crisis unscathed.

According to reports from Bloomberg, Dell will halt several staff benefits as of 1 June and until at least the end of the year.

The vendor will no longer make contributions to employee 401(k) retirement plans and will freeze internal pay rises and promotions as it looks to preserve cash during the COVID-19 crisis.

Dell has also put in place a hiring freeze until at least the end of 2020.

In a statement, Dell said the actions will help set it up for success when the pandemic subsides.

"Like all companies right now, we're constantly evaluating our business to plan for resiliency in the current environment and to support our team members, customers, and community in a way that sets us all up for success on the other side of this pandemic," the company said in a statement.

Last month, CEO and founder Michael Dell agreed to forgo his base salary for the remainder of its fiscal year ending 29 January 2021.

Dell-owned VMware also took measures at the start of the month in freezing staff salaries, and delaying promotions while its top execs took pay cuts.

Other vendor giants including HPE and IBM have also put in place measures to cut costs during the COVID-19 crisis, including making staff layoffs.

HPE confirmed that there will be job losses amid a wider programme that will also slash staff salaries between 1 July and 31 October. HPE's executive team have taken pay cuts of up to 25 per cent and has also frozen pay increases and external hiring.

IBM is meanwhile making layoffs across the business with some reports claiming thousands of jobs are at risk. Staff across five US states have already been made redundant.

The COVID-19 pandemic has hampered the tech industry over the last few months and hit the supply chains of industry titans such as Dell, HPE and Cisco.