“After listening to our staff and players, it’s clear that was the wrong decision,” Josh Harris, the founder of HBSE, said in a statement. “We have reversed it and will be paying these employees their full salaries. This is an extraordinary time in our world — unlike any most of us have ever lived through before — and ordinary business decisions are not enough to meet the moment. To our staff and fans, I apologize for getting this wrong.”
The pay reduction — which originally would have affected all employees making at least $50,000 before that total was boosted to $100,000 and then was scrapped altogether — would not have affected employee health plans or any other benefits. HBSE also was planning a four-day workweek for its employees, which would start immediately and last through June 30. Its plans in that area remained unclear Tuesday afternoon.
News of the pay cuts was first reported by the New York Times.
A Devils spokesperson said the decision was made to "keep jobs for our entire staff, during this unprecedented time, and not make any cutbacks on our workforce.”
HBSE’s reversal came after significant social media backlash from critics who pointed out that Harris, a private equity investor, has a $3.7 billion net worth. David Blitzer, Harris’s co-managing partner, is also a private equity investor whose net worth exceeds $1 billion.
Meanwhile, 76ers center Joel Embiid pledged $500,000 on Tuesday morning to aid medical efforts and to provide financial support to team employees affected by the salary reductions. The optics of Embiid, who is earning $27.5 million in the second year of a five-year, $148 million contract, covering for ownership prompted additional criticism of Harris, Blitzer and their ownership partners.
“In these trying times, I’m proud of the Sixers organization for reversing course and ‘doing a 180,' ” Embiid wrote on Twitter. “Let’s focus on beating this Coronavirus now. Let’s be responsible and Trust the Process!!”
The NBA and NHL have suspended operations indefinitely since March 11 and 12, respectively. ESPN reported Tuesday that the NHL is temporarily cutting league office employees’ salaries by 25 percent starting April 1.
As a fair amount of NHL teams across the league have, Harris and Blitzer are paying hourly and event staffers who work at Newark’s Prudential Center during the NHL’s “pause,” and they have committed to doing so for all postponed games and concerts. All events at Prudential Center, which is owned and operated by HBSE, have been canceled through the end of March.
The NBA is bracing for a $1 billion revenue hit and a record salary cap drop if it cannot resume play this season. Owners are weighing the use of the force majeure provision, an “act of God” protection in the collective bargaining agreement that could lead to the league withholding a portion of player salaries if games are canceled. The NBA has informed players that they will be paid in full through at least April 1.
Ben Golliver contributed to this report.