The number of global coronavirus infection has reached over 1,000,000 with more than 47,000 reported deaths. In an attempt to contain the outbreak, various countries have imposed full lockdown and stay-at-home orders. The pandemic has shaken up the world’s art market: major art institutions or galleries are temporarily closed; auction houses are postponing their upcoming sales. The Value has learnt that the management team of auction house Christie’s is going to take a voluntary pay cut amid market uncertainty.
In light of the coronavirus outbreak, Christie’s has postponed important sales weeks including Asian Art Week in New York, Luxury Week in Geneva, 20th Century Week in New York. Though the auction house has yet to make revised plans to its Hong Kong spring sales (30 May – 3 June) and London Classic Week (6 – 17 July), these sales are unlikely to run as scheduled with growing concerns from both consignors and buyers.
Auction houses are under tremendous financial pressure amid the coronavirus pandemic
As The Value has learnt, Christie’s management team and top-level staff have agreed to take voluntary pay cuts to get through the crisis with the company at this difficult time. The auction house also promised that reduced salaries will be reimbursed when the company's business is back on track. The reduction comes in varying degrees depending on the rank and salary. Junior staff will not be affected by this arrangement.
We inquired about this arrangement and Christie’s responded, ‘The health and safety of our employees, their families, our clients and the community remain our priority. Our thoughts and sympathies continue to be with all those affected by the Covid-19 virus. Christie’s are taking necessary steps to adapt to the ongoing situation including increased digital engagement and private sales as well as commensurate, targeted cost management measures. Our priority is to protect our teams and business and to continue to serve and engage with all those who enjoy and wish to collect art.’
Due to the fear of the next recession caused by the pandemic, many international companies have announced layoff or furlough plans. While Christie’s is seeking ways to alleviate financial stress, the management is voluntarily taking a pay cut to protect more junior staff. On one hand, the arrangement helps maintain staff morale by offering job security during this challenging period. On the other hand, the promised salary reimbursement also shows the company’s recognition of employees’ sacrifice.
Auction houses are now under tremendous pressure since most live sales are postponed. U.S. lawyer Nicholas M. O’Donnell, who specialises in cases related to art dealing, warns the art world about a wave of bankruptcies in the upcoming months to years. For details, please read U.S Lawyer Warns That COVID-19 Might Cause a Bankruptcy Wave in the Art World.