More than 100 team members at workspace provider Servcorp have been stood down as the company comes to terms with the Covid-19 economic reality.
In addition to the stand downs, the majority of remaining team members have agreed to reduce their salary by 20 per cent.
This includes non-executive directors who have also agreed to a reduction of fees by 20 per cent, while longstanding CEO Alf Moufarrige will see a 50 per cent pay cut.
Given the current uncertainty and market volatility, Servcorp has decided to suspend current guidance.
The group has also eliminated all discretionary spending to keep operational costs to a minimum.
"We are working through the exact impacts on our global footprint but we anticipate, and are planning for, a significant but temporary reduction in serviced office occupancy and coworking utilisation, with some offset from our virtual office products," says Servcorp.
"Our priority in any crisis is the health and safety of our people, and that of our clients who utilise our locations globally."
The company says it is working with landlords, teams, and clients to minimise costs across the business.
Servcorp's Landlords so far are favourably considering rent reductions to mitigate to some degree rising vacancies and small business' inability to fulfil their obligations under lease agreements.
The company has no external debt, but despite this Servcorp has suspended all capital expenditure programs at this time.
"Servcorp has proven, over more than forty years of its existence, to be a robust business, and this remains the circumstance today," says Servcorp.
"We are confident that Servcorp will emerge from the Covid-19 crisis in a financially sound position and full of determination."
Updated at 10:06AM AEDT on 3 April 2020.
Help us deliver quality journalism to you.
As a free and independent news site providing daily updates
during a period of unprecedented challenges for businesses everywhere
we call on your support