Michael Rubin

Sixers Reverse Course On Reducing Employees’ Salaries

Sixers ownership has reversed course on a plan to reduce certain employees’ salaries, reports ESPN’s Adrian Wojnarowski (via Twitter).

Full-time 76ers employees who earn at least $50K annually were informed on Monday that their salaries would be temporarily reduced by up to 20% as the NBA remains on hiatus, as Marc Stein of The New York Times details. Those employees were told that the new measures would apply to pay checks from April 15 through June 30, with health benefits and 401(k) plans unaffected, says Stein.

Sixers majority owner Josh Harris, whose Harris Blitzer Sports & Entertainment also owns the NHL’s New Jersey Devils, confirmed those plans in a statement today, but indicated they won’t be moving forward.

“Our commitment has been to do our best to keep all of our employees working through this very difficult situation. As part of an effort to do that we asked salaried employees to take a temporary 20% pay cut while preserving everyone’s full benefits — and keeping our 1,500 hourly workers paid throughout the regular season,” Harris said. “After listening to our staff and players, it’s clear that was the wrong decision. We have reversed it and will be paying these employees their full salaries.”

The measures, which have now been nixed, wouldn’t have affected any players. They also wouldn’t have applied to employees on contracts, including members of the coaching staff or certain front office executives, Stein notes. Only “at-will” employees would have been required to accept the salary reductions, Wojnarowski adds (via Twitter).

However, according to Stein, some additional members of the organization had been asked to participate in the rollbacks as well — Sixers GM Elton Brand was among those who had agreed to take a temporary pay cut. Wojnarowski tweets that coaches and executives whose salaries couldn’t be unilaterally cut were initially given until Thursday to agree to a salary reduction of 20%. Per Woj, many were reluctant to give back that money, particularly since their employment situations beyond this summer are uncertain.

As Wojnarowski tweets, other team owners were keeping an eye on the situation in Philadelphia. Those owners were weighing their own desire to save money against the potential PR backlash that such a move would generate. Presumably, based on the negative PR the 76ers faced and the quick reversal that followed, no other teams will immediately enact similar plans.

Sixers part-owner Michael Rubin actually contributed to that PR backlash that helped push the club to change its plans — Shams Charania of Stadium (video link) reports that Rubin wasn’t believed to be part of the decision to reduce employees’ salaries and was said to be “upset” and “outraged” by it.

Meanwhile, before the 76ers’ change of heart, star center Joel Embiid announced that he’s pledging $500K to COVID-19 medical relief efforts in the community and that he was committed to helping Sixers employees who would suffer financial hardship in light of the team’s salary reductions (Twitter link via Ramona Shelburne of ESPN). With the Sixers no longer planning to reduce employees’ salary, Embiid’s financial commitment beyond that $500K for coronavirus purposes no longer appears necessary.