Ford will pay merit increases to salaried employees in the US and Canada in April after delaying such increases since 2002 as a cost-cutting measure.

About 38,000 employees are eligible for merit-pay increases that go into effect April 1, spokeswoman Marcey Evans said. Ford, starting in 2002, delayed such raises until the second half of the year.

Ford told employees it would restore April 1 merit increases, originated in 1995, when finances improved, she said, according to reports. Ford had $6.4 billion in combined losses in 2001 and 2002, while generating $3.49 billion in net income last year.

Chief Executive William Clay Ford Jr., 47, has been paid primarily in stock options and not taken a salary since assuming his post in October 2001.

Ford also is ending a freeze on merit-pay increases for the company's top 52 executives, including Bill Ford, Evans said. She declined to say whether Bill Ford will begin taking a salary.