The Pittsburgh Pirates became the first known MLB team to suspend retirement benefits for baseball operations employees in a cost-cutting reaction to save jobs amid the coronavirus crisis.
Pirates general manager Ben Cherington confirmed Tuesday afternoon a report by The Athletic that the club has suspended 401(k) contributions in an effort to preserve full salaries. The Pirates also said they have suspended their fellowship and internship programs.
“There’s a whole number of levers that potentially an organization can pull,” Cherington said on a conference call with Pittsburgh reporters. “Every organization in baseball, I would say, is mostly looking at some combination of the same things. … We did identify the retirement contributions, at least temporarily, as an opportunity, an area where we might find some savings without too much impact on people and their every day lives. The full expectation is that contribution will go back into effect as soon as possible. I think that’s a lever, frankly, that other teams either are or will soon or will certainly consider pulling as the year goes on, just because every team is going through that same exercise.”
The New York Post reported Monday that New York Mets employees will take tiered pay cuts for the remainder of the year, starting June 1, with top-level executives making $500,000 or more receiving a 30% pay cut while those making less than $45,000 taking a 5% pay cut. The Tampa Bay Times reported Tuesday that the Tampa Bay Rays have begun staff furloughs and will cut pay for all staff of a certain salary, as well as canceling their internship program.
The Pirates announced last week that they would pay full-time employees through May and are exploring a tiered salary reduction for the highest-paid members of their front office and coaching staff, with what Cherington called “very few exceptions.”
“The shutdown has impacted all of us, all of you, our fans certainly, business partners, our players and every Pirates employee, everybody who’s connected to the Pirates, everybody who’s connected to baseball and certainly globally,” Cherington said. “None of us are immune to this.
“In baseball and also with the Pirates, it sort of turned our business upside down. Revenues aren’t coming in. Cash is still going out. A big focus of ours in recent weeks has been to try to figure out how to solve for that problem in a way that minimizes impact on our people, peoples’ families and our core activities but with a clearer knowledge that we need to find savings in 2020 so that we avoid placing too much long-term pressure on the business and potentially impacting short- or long-term goals.”
