Container Store boss Satish Malhotra cuts his $925,000 base salary by 10% for six months so employees can get a raise if company profits take a hit
- CEO Satish Malhotra requested a temporary pay cut to secure pay increases for staff
- Container Stores sales have taken a hit due to inflation and higher interest rates
- The company is trying to cut costs and announced layoffs in May
The CEO of The Container Store has offered to cut his base salary by 10 percent to offset employee pay increases as the company struggles with weak sales.
Satish Malhotra will see his annual salary cut from $925,000 to $832,500 for six months from October 1, the company confirmed in a regulatory filing last week.
The filing noted that Malhotra requested the pay cut, and the company confirmed to DailyMail.com that it would ensure employees receive annual raises even as it tries to reduce costs.
The Container Store has suffered weak sales and declining profits in a tough environment for home goods retailers as inflation and higher interest rates shift consumer spending away from durable items.
In May, the Dallas-based company announced layoffs affecting about 15 percent of employees in its support centers and 3 percent of employees in distribution centers and stores.
Container Store CEO Satish Malhotra will see his annual salary reduced from $925,000 to $832,500 for six months from October 1
The company, which has 97 locations in the U.S., sells storage and home organization products and custom cabinetry
The exact number of people affected by the cuts has not been disclosed, although the company employed around 5,200 people at the time.
Malhotra joined The Container Store in 2021 after more than two decades as an executive at Sephora.
His base salary is only a fraction of his total compensation, which also includes stock awards.
Last year, his total compensation package was $2.6 million, according to public disclosures.
Malhotra’s self-imposed pay cut comes after he was forced to preside over painful cost cuts at the company, which has seen sales fall dramatically.
For the quarter ended July 1, Container Store revenue fell 21 percent from a year ago to $207 million.
Last year’s quarterly profit of $10.5 million turned into a net loss of $11.8 million for the quarter.
Shares of Container Store are down 54 percent since the beginning of the year
Shares of Container Store are down 54 percent since the beginning of the year.
The company, which has 97 locations in the U.S., sells storage and home organization products and custom cabinetry.
In a filing with the regulator, Malhotra said he would waive the right to reclaim his temporary pay cut in the future.
He signed a letter stating that the “temporary reduction in base salary will not constitute a breach or violation by the Company of any provision of your employment agreement with the Company.”