Top Telecom employees will not be getting a pay rise this year as the company tries to cut costs.
The freeze on salary increases comes as the company sees its half-year profit tumble by almost 6%.
New Zealand's largest listed company made $162 million in the six months to December, down 59% on the $397 million it made in the same period the previous year.
Telecom chief executive Paul Reynolds says the company has a responsibility to try to cut costs where it can.
Mr Reynolds says tougher competition and asset writedowns are to blame for the fall in profit.
The result includes a $68 million dollar write-off at its subsidiary PowerTel and a $33 million write-off of old GSM mobile equipment.
However, Telecom still expects to make between $460 million and $500 million profit in the full year.
The company's executive team and most senior managers will receive no pay increases this year.
Mr Reynolds says Telecom has a responsibility to trim costs where it can.