boss wants me/us to take a 50% pay cut

hampsterpoo · 24 December 2008 at 8:11PM

Hi

Today the manager called a meeting and he suggested that all staff take a 50% paycut for a minimum of 2 months :eek:
or else he will have to make redunadances/suspend staff for minimum of two months.:eek:
All staff are still required to work normal hours and some extra if needed.:cool:

Whilst not wanting to have no job, or wishing redundancy on anyone else ,
I cant afford this and none of the others can either.

Were do we all stand??? obviously his timing was spot on for us not being able to ring CAB and ask advice.:mad: :mad:

He's willing to take the 50% cut himself :A
(his 50% cut is still more than my wage)
He's paid everything off owns his house cars etc and has pensions all sorted.

Any advice appreciated.

bryanb · 24 December 2008 at 8:17PM

Hard to see how he could "suspend" staff. Surely that's used in disciplinary matters? However you need to think seriously about this, obviously things are pretty bad, so whatever advice you get from CAB etc won't change the position. Probably the alternative is winding up the company, and nobody wins then.
In your position I would start looking for a new job

Scousebird_2 · 24 December 2008 at 8:26PM

It would have to be suspension on full pay surely??

Voyager2002 · 24 December 2008 at 8:32PM

If you are union member, seek their advice.

If you have never bothered to join a union, then you might just as well agree to work for no pay at all until the end of the recession. That would at least demonstrate your commitment to the success of the enterprise.

Errata · 24 December 2008 at 8:33PM

OP, read this about being laid off - he can't do it. http://www.direct.gov.uk/en/Employment/RedundancyAndLeavingYourJob/DG_10026693

ceridwen · 24 December 2008 at 8:43PM

Gawd! What an awful "christmas present"!!!!!

I dont know what salary you are on. I dont know what your financial circumstances are. All I do know is what my answer would be.......errrr......a four letter one in a word.....followed by appropriate gesture.

Try googling for the TUC website and see what advice there is on there re workers rights.

I guess the first question is "on what basis are redundancy payments worked out" - as in are they worked out according to what ones normal salary is or based on the level of salary one has received over the last month or two. If they are based on normal level salary - then that is one thing. If they are based on only the level of salary one has received over the last month or two - then you seriously should not accept a "temporary" salary drop - as that will impact on your redundancy payout.

I'm saying this - as I think redundancy payout is the next thing that looks likely to happen I'm afraid - so dont agree to anything that would affect the level of that if it comes to it.

What he is doing is out and out blackmail - not to put too fine a point on it. The timing too is downright "dirty". I think he might just find that sort of timing will backfire on him from the other workers as well - as that sort of timing is so obviously SUCH a dirty trick. He is trying to "bounce" you all into this - you know your circumstances and we dont. I CAN only say what my own personal response would be, ie "I dont play ball games - play bouncing balls with someone else. The job...the whole job...and nothing but the whole job" - but I personally have spent years preparing for NOW and I appreciate you are probably in different circumstances. Also - we have no idea of your paylevel - my pay is so low that it would be physically impossible to cut it much - as it would be beneath NMW and I would then report them for being "illegal". I have no idea what paylevel you are on.

Good luck.

rheme · 24 December 2008 at 9:07PM

Try the Acas Helpline: 08457 47 47 47. You don't have to be in a union and the help is free. CAB would be good too.

By stating that all staff are required to work normal hours (and some extra if needed). If you work extra hours this amounts to more than a 50% pay cut.

Is no member of the workforce in a union that could provide advice?

Does the 'Manager' own the company? How would you know if he had taken a 50% pay cut?

Agree with Ceridwen's questions about how redundancy payments are worked out/rates of pay.

He has stated a 'minimum' of two months, what is the 'maximum'. To make any changes at all he would need to change your terms of employment and give advance notice. What is in your contract of employment?

Suggest that no-one agrees to anything until you have got some expert advice.

Try not to let this spoil your Christmas Day, deal with it asap afterwards.

Good Luck

briona · 24 December 2008 at 9:10PM

An employer CAN cut wages although a 50% pay cut is pretty steep! Unfortunately if you refuse to accept this, and he cannot continue to pay the salaries he's paying, he is within his rights to make you redundant. Not sure with regards to the temporary lay off though...

A few years ago I worked for a company where when faced with redundancy some of the staff (clearly desperate to hang onto their jobs) proposed a 20% pay cut. Had the pay cut ever been implemented I would have had to hand in my notice as I simply couldn't have afforded to lose that much money. That said you have to weigh up whether 50% of something is better than 100% of nothing...

How long have you worked for the company? If you have over 2 years' service you will be entitled to redundancy pay, the statutory minimum being 1 week's pay for every full year worked (1.5 weeks' pay if you are over the age of 41). If you have clocked up a substantial amount of service, you may be better off taking redundancy rather than a pay cut. Do you know how easy/hard it would be to find another job in your industry?

Auzelia · 24 December 2008 at 9:37PM

surely he cant make you redundant if the job/work is still there though.
I thought redudancy was for positions that where no longer available.
And I dont think he can reduce your pay to below NMW.

50% is a big fall in wages, I know I personally couldnt afford it and I am only on NMW. But best of Luck to you and I hope you get it sorted.

ceridwen · 24 December 2008 at 10:00PM

Auzelia wrote: »

surely he cant make you redundant if the job/work is still there though.
I thought redudancy was for positions that where no longer available.
And I dont think he can reduce your pay to below NMW.

50% is a big fall in wages, I know I personally couldnt afford it and I am only on NMW. But best of Luck to you and I hope you get it sorted.

He DEFINITELY cant reduce the salary to less than N.M.W. - the law wont allow it (having said that - someone would need to report him for this). I would be inclined to agree that a person cant be made redundant if the job is still there - but, unfortunately, the law DOES allow an employer to impose a paycut (provided the pay doesnt go beneath N.M.W. level) - so he could manage to cut the pay - even down as far as NMW level:eek: and your only redress would be to claim whatever Tax Credit you could to try and make up the balance as far as you could - but that is a problem of itself if you dont have children - as childless people get VERY little help with that.:eek: :cool:

briona · 24 December 2008 at 11:04PM

Auzelia wrote: »

surely he cant make you redundant if the job/work is still there though.
I thought redudancy was for positions that where no longer available.

It is illegal to trade whilst insolvent, and you may find that the company has taken advice from an insolvency practitioner who has recommended the actions the employer has now put forward. Basically if the company needs to reduce overheads in order to survive they can do that through salary cutting or through redundancy.

Wage bills (incl. employer's NI and pension contributions) are usually a company's biggest outgoings. If the OP works for a company where people's jobs are dependent on sales for example (as in sales is their main business – double glazing, cars, photocopier rental/sales etc) and the sales being made no longer cover the overheads then they are within their rights to make you redundant, regardless of whether your actual position is still there, otherwise the company would go bust!

With regards to the actual % reduction, if everyone is on the same salary (or thereabouts) it's a bit less galling that you all lose the same amount, but if people earn different salaries it would be fairer to have a sliding scale of reductions. After all 50% of 40K is a lot different to 50% of 16K. Obviously salaries can't be cut to less than NMW.

boss wants me/us to take a 50% pay cut

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