British Telecom (BT) said that it will give a miss to salary hike to UK staffs for 2009-10 as it completed its internal salary review on Wednesday.

Sullen by the worldwide economic meltdown, the pay freeze will apply to all UK staffs, including the company’s top most executives.

“This has not been an easy decision but, given the tough economic climate, it is important BT meets these challenging times head on,” said a BT spokesman.

While citing the decision as a tough one, it was made after BT’s Global Services division encountered a series of crisis, which includes a £340m writedown in value of 15 of its 17 most valuable contracts.

The telecoms group had earlier warned of its performance at its global services division to not meet the current market expectations.

With the decisions about bonuses yet to be made, the spokesman has cast it significantly lesser than previous years and in many cases won''t be given at all.

The company has announced 9,500 job cuts in the nine months to December 31 and said it expected to hit its target of over 10,000 be end-March.

BT’s profits for the last three months of 2008 fell 81 percent.

Sooner in the day, Toyota announced plans for a 10 percent reduction in pay and production at its two British factories as the motor manufacturer tries to weather the economic storm. Rival Jaguar Land Rover has also introduced a pay freeze.