Telecommunication Company Vodafone said yesterday it will impose a salary freeze on 10,000 UK employees as it seeks to cut cost amid the sullen world economy.

The announcement comes in the wake of 500 job cuts made in UK as a part of plans to save £1 billion worldwide by March 2011.

The move was revealed via a confidential email marked by Guy Laurence, the chief executive of the firm''s UK business, to the company’s UK staffs particularizing the pay freeze.

Referring to the announcement as a ‘tough decision to make, but a responsible one’, Lawrence added that that if the company had agreed to a salary rise it would have driven them to hike the number of redundancies in the recent announcement.

Further he added that changes will be seen made to the next financial year’s bonus plans as well.

According to reports, the management too will give up on any salary increase, while board members are believed to stand unaffected.

Shares in Vodafone slumped to 120 pence a share last week, down from nearly 160 pence a year ago.

Earlier in the month British Telecom too had announced plans to freeze the wages of its employees countered by the weakening economy.