UPDATE 2-Steelcase to cut salaries, begin layoffs

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Feb 2 (Reuters) - Steelcase Inc (SCS.N), the world's largest office furniture maker, said it will cut the base salaries of all its North American salaried workforce by about 5 percent and suspend 2010 matching contribution to its retirement plan.

In a filing with the U.S. Securities and Exchange Commission, the company also said the annual salaries of its chief executive and chief financial officer will be reduced by 12 percent and 10 percent, respectively.

Other board members are also taking a voluntary salary reduction, the company said. According to the filing, the board will take a 15 percent reduction in annual retainer for one year.

The company estimates it will reduce annualized pretax operating costs by about $25 million to $30 million, during the time these actions remain effective.

The actions, which are effective March 2, will remain in place for a year, or until economic conditions improve, the company said in a statement.

"The current economic environment and its potential impact on industry demand around the world remains highly uncertain," CEO James Hackett said.

Steelcase is also planning a reduced annual non-discretionary contribution to its retirement plan.

It will begin laying off about 300 of the 600 previously notified employees of its North American hourly workforce. Steelcase employs about 13,500 people worldwide.

It had announced these job cuts in December, when it also announced a dividend cut and forecast a fourth-quarter loss.

Shares of the company were trading almost flat at $4.31 Monday on the New York Stock Exchange. (Reporting by A.Ananthalakshmi in Bangalore; Editing by Amitha Rajan) ((ananthalakshmi.as@thomsonreuters.com; within U.S. +1 646 223 8780; outside U.S. +91 80 4135 5800; Reuters Messaging: ananthalakshmi.as.reuters.com@reuters.net))