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Carnival Corporation will end a 20% pay cut for salaried employees in December and resume matching 401(k) contributions for US-based employees in January, CEO Arnold Donald said in a video message to his workers. The video, which was viewed by Business Insider, was posted to an internal website earlier this month.
In May, Carnival went through a round of pay cuts, layoffs, and furloughs to preserve cash while it shut down its cruise operations indefinitely amid the COVID-19 pandemic. The moves also helped Carnival raise new funds, Donald said in the video.
Business Insider reported in May that Carnival had planned to end pay cuts for UK-based employees in December. (The company declined a request for comment on whether it had the same intention for US-based employees.) That the company has been able to follow through on that plan suggests, at the least, that its outlook has not grown worse over the past seven months. But, as Donald indicated in the video, the company continues to be impacted by the pandemic.
“While these actions are certainly positive, it’s still far too soon to declare any kind of victory,” Donald said. “Many of your colleagues continue to be furloughed, there is still much pain being felt by the impact of the pandemic, and we are still, with the exception of some very limited cruises in Europe, without revenue.”
Much of the cruise industry has been shut down since March, following sailings where dozens, and in some cases hundreds, of passengers and crew members contracted the coronavirus. Carnival and rivals like Royal Caribbean Group and Norwegian Cruise Line Holdings have since raised billions of dollars and slashed costs in the face of uncertainty around when they will be able to return to many of their key markets.
Despite the historic challenge the coronavirus has presented, there have been reasons for optimism in recent months. Some customers have expressed a desire to return to cruise ships next year, and, at the beginning of November, the Centers for Disease Control and Prevention replaced its no-sail order with guidelines that lay out the steps cruise lines need to take before they can resume carrying passengers in US waters.
“There is a new sense of optimism in the air that we really haven’t felt for a long time,” Donald said in the video.
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