In a memo to employees, Cinemark announced that it is implementing severe pay cuts of at least 50% to its entire corporate workforce while CEO Mark Zoradi will forgo his entire salary for the duration of the coronavirus pandemic that has closed tens of thousands of movie theaters around the world.
While the measures to ensure financial stability are drastic, Cinemark is not currently planning to layoff its corporate employees. With no theaters open to provide chains with income during what would usually be a busy spring box office season, many theaters are being forced to temporarily layoff much of their workforce in order to maintain cash flow. More than 90% of employees for the top three American cinema chains — AMC, Regal and Cinemark — have been furloughed, including all of AMC’s corporate employees at its Kansas headquarters.
“Cinemark’s priority as it navigates through this uncertainty is to ensure that the company will be able to once again open theaters and employ our global team members,” Zoradi wrote in a memo. “I look forward to the day in the hopefully not-to-distant future when the Cinemark team can once again welcome guests to enjoy the immersive moviegoing experience we offer at our theatres.”
With less debt than AMC or Regal, Cinemark is in a more stable position to weather theater closures that may last well into the summer. While corporate employees will not be furloughed, they will work reduced hours and take cuts of at least 50%, though they will maintain full benefits.
The pay cuts come three days after Congress passed a multitrillion stimulus bill that was applauded by the National Association of Theater Owners, who says that the loan programs that will be established as part of the legislation will provide movie theater companies with much-needed support to remain solvent during the coronavirus pandemic. NATO also established a $2.4 million fund on Monday to provide financial support to movie theater employees who are now without any income because of theater closures that have shut down over 5,500 cinemas and left over 150,000 hourly employees out of work.