Employees of Idexx Laboratories Inc. learned Wednesday of a temporary 10 percent reduction in their wages in response to the coronavirus outbreak, which has resulted in less demand for the company’s veterinary products and diagnostic services.

The biotechnology company, based in Westbrook, employs roughly 3,000 people in Maine and another 6,000 around the world. In a Wednesday morning memo to employees that was leaked to the Portland Press Herald, Idexx CEO Jay Mazelsky noted cost-cutting steps already taken and listed a few more due to take effect in the next pay cycle.

The new steps include tiered pay cuts for most U.S. salaried employees, most at 10 percent, with senior management taking bigger compensation hits – 30 percent for Mazelsky and 20 percent for vice presidents, corporate vice presidents and executive vice presidents. Cash payments to the company’s board of directors will be suspended, as will company contributions to 401(k) retirement plans of U.S.-based employees, starting May 8.

“The broader uncertainties related to COVID-19 require us to focus on what we can control,” Mazelsky wrote. “We need to take quick and deliberate action to reduce costs in ways that protect our financial health and leave us well-positioned for future growth.”

Before cutting payroll, Idexx restricted travel and put a freeze on hiring and promotions, according to a company spokesperson, who added that the new cost-saving measures “are in keeping with our goal of job preservation.”

As the only Maine company listed on the S&P 500 Index, Idexx reported revenue of $2.4 billion in 2019, up 8 percent from the previous year thanks largely to its pet veterinary diagnostics division. The company spent $70 million expanding its headquarters in Westbrook and building a new laboratory in Germany.

In August, Idexx signed a deal with the state to hire 80 new employees annually for 10 years and achieve other benchmarks in order to receive $800,000 in annual business tax breaks over the next two decades.

“Our customers are still performing essential services for their clients, caring for sick and injured pets in need of immediate attention – and Idexx remains a trusted and essential partner,” Mazelsky wrote to employees. “However, there has been less demand and fewer patient visits due to government policies designed to control COVID-19 spread as well as guidance from veterinary organizations suggesting postponement of elective activities including wellness visits. This translates to less demand for our products and services.”


Only subscribers are eligible to post comments. Please subscribe or to participate in the conversation. Here’s why.

Use the form below to reset your password. When you've submitted your account email, we will send an email with a reset code.