Sports

76ers, Devils reverse decision to cut salaries up to 20% due to coronavirus hiatus

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Key Points
  • Teams are being forced to make difficult decisions as sports are on hiatus due to the coronavirus.
  • The Sixers and Devils announced this week they would cut hours and pay for employees, but reversed the decision a day later after being met with resistance.
The logo for the National Hockey League's (NHL) New Jersey Devils is displayed outside the team's home arena, the Prudential Center, in Newark, New Jersey.
Victor J. Blue | Bloomberg | Getty Images

After mounting pressure from players, employees and the public, the owners behind the Philadelphia 76ers and New Jersey Devils are reversing course on their decision to force employees to take a temporary 20% pay cut.

"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....To our staff and fans, I apologize for getting this wrong," owner Josh Harris said in a statement Tuesday.

The reversal comes after Philadelphia 76ers and New Jersey Devils' employees were informed on Monday that they will be receiving temporary salary reductions of up to 20% starting April 15 and going through the end of June. The cuts initially applied only to employees making more than $50,000, but the team changed it to $100,000 on Tuesday morning. The changes also included a 4-day work week were made to ensure "we can support and operate our businesses during these uncertain times without reducing our workforce," Harris Blitzer CEO Scott O'Neil said. 

But Harris Blitzer reversed the decision to cut pay and the work week just hours after it raised the threshold for the cuts to employees making at least $100,000 per year.

In response to the initial decision to cut pay, 76ers center Joel Embiid announced he would donate $500,000 with some of that money going to help team employees whose salaries have been reduced. 

Ownership also faced pressure and backlash on Twitter, with many citing their net worth. Even minority owner Michael Rubin was reportedly furious by the decision. 

Tweet.

The Sixers and Devils are owned by Harris-Blitzer Sports and Entertainment, a group that includes billionaires Harris, co-founder of Apollo Investment Group and David Blitzer, an executive at Blackstone. Forbes estimates that Harris is worth $3.8 billion. 

Devils managing partners Harris and Blitzer were among the first NHL owners to publicly commit to paying part-time workers for any postponed or canceled games and concerts through the end of the regular season. The Prudential Center in Newark, where the Devils play, hosts over 175 live events each year. 

The Devils were purchased by the group in 2013 for $320 million. The team is now valued at $550 million, according to Forbes. The 76ers were purchased for a reported $280 million in 2013. The team is now worth more than $2 billion.

Also on Tuesday, Group CH, which owns the Montreal Canadians, announced that 60% of the organization's workforce will be temporarily reduced beginning March 30. An assistance fund will allow the workers to receive 80% of their base salary for a period of eight weeks, and loans will be made available to those who need it.  

"This decision was necessary given the significant impact the pandemic has had on the sports and entertainment industries," said Groupe CH owner, president, and CEO, Geoff Molson in a statement.

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