Employees at ATV have been warned to be 'mentally prepared' for a new year pay freeze, while further redundancies cannot be ruled out. The company, with 1,400 employees, sacked 135 workers in July, citing revenue losses and the need to restructure to compete with TVB. Chief operating officer Bruno Wu Ching said at the time there would be no more mass dismissals. But a company source said this week the firm might make further staff cuts, possibly laying off 10 per cent of the news staff, as well as freezing or cutting pay. 'Some people feel unstable. They are looking for new jobs,' one employee said. 'It's hard to know what is happening. A lot of stuff we read in the papers first. It would be no surprise if we got a pay cut, but it is more likely we will get a pay freeze.' Yesterday, an official gave a strong hint of an impending pay freeze. Steve Loo Chung-keung, senior vice-president of finance, said there were no immediate plans for further layoffs or pay cuts, but he could not rule out the possibility. 'It depends on the financial situation. Our goal is to increase competitiveness and strengthen our company. In trying to achieve this goal, we might find that there are excess staff,' he said. 'Employees should be mentally prepared for a pay freeze. In a company that is not making money, a pay rise is unlikely,' Mr Loo said. Earlier this year, Mr Wu said the firm had lost $130 million in the first half of the year and restructuring was necessary as the company was 'on the verge of dying'. Fears about the firm's finances deepened this week when the company said it would pay December's wages after Christmas, instead of before as it had in the past. Bonuses would not be paid until just before the Lunar New Year in February. In the past, employees who joined ATV before 1995 received half of their two-month bonus in December. Yesterday, a spokesman insisted the company's financial situation was stable and said it had been breaking even since August.