Last statement is actually the gist of what I wanted to mean. The moment you make a mass layoff that sends a message to all employees.

Please be mindful of measly 3% decrease in your salary, you wouldn't even see the difference.

The more open the management is to their employees the more they become loyal. It's all about honestly sharing burden.

You can always layoff not performing employees, a company has all the right to do so. We are talking about a mass layoff.