notice period to apply pay cut?

coolshades

how does the application of a pay cut work? does the employer have to apply the pay cut only after completion of notice period in the employee's contract? or can employer enforce it immediately?

for example if an employee has 2 months notice, then can the pay cut be applied by employer after 2 months, after serving proper notice etc, or can it be applied like tomorrow?

LittleVoice

What sort of pay cut? Amount of money paid for a given amount of work/time?

If so they can't enforce it. It requires the employee's agreement. If the employee agrees then it can be immediate.

If the employer can show that it is necessary for them to pay lower salary/wages (because otherwise they are not profitable), then this would be a substantial reason for dismissing an employee who did not accept the required cut. They would then need to give the ordinary required notice for dismissal. In the example it would be two months.

ceridwen

I am confused as to whether it would be dismissal or redundancy if an employee refused to accept a paycut. Are there any suitable legal type links on this to clarify the position? I think if it was a case of an employer expecting an employee to do less hours - then surely that would count as a different "post" to what the employee had taken on and the original "post" would no longer exist - and therefore it would be a redundancy? I have the feeling that the law may be a bit unclear on this - and we will be having a test case soon to clarify this?

If it is the case that it would be deemed to be a dismissal - then what would the position be in regards to getting due benefit immediately? Would there be a benefit disqualification imposed by the D.W.P. for that "up to 26 weeks" period they are allowed to impose disqualification for - or would they accept that it hadnt "really" been a dismissal - as it had occurred because of the employee refusing to "accept a different job" (ie a lower-paid job to the one they had accepted at the initial interview for the job)

SomeBozo

As LV says, it can be enforced if the company is in danger of going out of business. The way to look at it is that if a company goes out of business then it will default on all its bills, hence put other companies in danger.

It will also not raise in any tax (in fact it will increase the burden through benefits), so it suits all round if the company can cut costs. One of these (and lastly) can be wage bills.

While devasting for the employee, its for the greater good.

Again ceridwen (I broke one of my rules by responding on a thread you participate in) I shudder at your advice.

Bozo

LittleVoice

Hi, ceridwen

Redundancy is dismissal - it's one of the fair grounds for dismissal.

The OP (coolshades) had not mentioned a reduction in hours as well as pay which is why I asked the question at the beginning of my post. I then went on assuming that it was just in pay for the same number of hours - which many other posters have enquired about. So this would not be a redundancy.

Regarding your question about how the DWP would treat a dismissal because you would not accept a "pay cut for the same hours" offer, I don't really know as they might say you had made yourself deliberately unemployed. The DWP people who assess these things must have some guidelines (perhaps on the proposed reduction percentage?). UKDickie is pretty knowledgeable on this sort of thing and may come along and help.

LV