The Mayo Clinic has announced it will embark on a series of sweeping pay cuts and furloughs in response to the COVID-19 pandemic.
The Rochester institution is facing a $3 billion budget shortfall this year as the coronavirus response in Minnesota and other states it has a presence in has involved a severe reduction or cancelation of elective procedures.
Chief Administrative Officer Jeff Bolton said on Friday that this was the right decision to preserve personal protective equipment (PPE), but that it has led to a significant reduction in revenue, with its main hospital in Rochester only operating at around one-third of its capacity.
As a result, the Mayo announced on Friday that it will be implementing a broad range of pay cuts on staff at all salaried levels.
The pay cuts affect around 20,000 Mayo workers through Dec. 31, and are being distributed as follows.
– 20 percent pay cut for Mayo executives, CEO Gianrico Farrugia.
– 10-15 percent pay cut for doctors and senior administrators.
– 7 percent pay cut for other salaried employees.
Hourly workers won't see their pay changed, but as yet undetermined number will be asked to take extended furloughs.
Even with the cuts, the Mayo Clinic says it's still predicting a $900 million budget shortfall.