Grey New York furloughs staff, implements voluntary salary reductions
WPP's Grey will be furloughing about 3.5 percent of its staff in New York, Ad Age has learned.
People close to the agency said the furloughs are expected to last approximately three months. Those people said Grey has also put in place hiring and salary freezes as well as temporary salary reductions on a voluntary basis among senior employees.
A Grey spokesperson declined to comment on the specific cost-cutting measures the agency has implemented.
"Grey has had a strong start to 2020 with the Discover win, among others," a Grey spokesperson said. "We're using all levers possible to protect jobs and be ready to ramp up in [the third quarter] when the economic climate improves."
Grey New York picked up the creative agency-of-record title for Discover in February, replacing incumbent The Martin Agency, which resigned the account last year. The agency's other clients include HSBC, Pfizer and Bose, plus some in categories hard-hit by the COVID-19 pandemic, like Applebee's and LongHorn Steakhouse.
While holding companies, including Omnicom and Dentsu Aegis Network, have implemented furloughs and layoffs, Grey parent WPP CEO Mark Read had said he would be doing everything to avoid furloughing and cutting staff.
In a financial update issued late last month, Read said WPP launched a review of its costs, with protecting its people a top priority. At the time, the holding company said it had introduced a hiring freeze; was reviewing its freelance expenditure; stopping discretionary costs, including travel and hotels and the costs of award shows; and would be postponing planned salary increases for 2020. The WPP executive committee also took a 20 percent pay cut for an initial period of three months.
The actions taken by rival holding companies are as follows: Publicis Groupe said it implemented a hiring freeze and executive salary reductions; Omnicom Group CEO John Wren warned staff in a memo this week that furloughs and staff reductions would be carried out across agencies and said he would be waiving his entire salary through the end of September; and Dentsu Aegis Network confirmed on Monday that had it initiated salary reductions and furloughs across the holding company and its individual agencies.
Meanwhile, Ad Age learned last week that Interpublic Group of Cos.' MullenLowe cut 10 percent of its U.S. staff. Giant Spoon confirmed that it laid off 20 percent of its staff last month, blaming the negative impact of event cancellations on its experiential business. And the week before Giant Spoon initiated its cuts, Anomaly laid off 22 employees and said most executives in its New York office had taken a temporary 10 percent pay cut.