Pay freezes (private sector)

dark crystal

My partner has worked for a local company for the past six years and has never received a pay rise, due to a pay freeze, apparantly because of diminishing profits (whenever pay is questioned, this is the excuse given).

Now, without being personally privy to this company's accounts, the business actually seems to be doing swimmingly. Shareholders profits have increased year on year and their annual turnover last year was listed at €33,000,000 (same as the year before). They have large recruitment drives two to three times a year and have won two new big contracts this year alone, yet pay for the staff remains unchanged year in and year out.

I was just wondering, are private companies allowed to set pay freezes for such a prolonged period? What rights do workers have to question such policy
? It just seems hugely unfair to me.

Mr. Loverman

Yes, there is no law which says private companies must provide an annual raise.

I used to work for a multinational who used the same line. I could have gotten better money elsewhere, but like your husband, I had been there for many years so knew everyone and everything very well and in general was treated ok. I chose to stay until I left Ireland.

dark crystal

I don't even think he expects a pay rise every year, but after six years of working hard for this company, not to see even a small gesture from them is really bad form. They're clearly telling porkies about being on the breadline, which is even more infuriating.

He's looked for other jobs (his work history is in admin), but jobs in our locality in that sector are slim pickings. Most vacancies in that field have been swallowed up by jobsbridge schemes. He applied for at least half a dozen other jobs during the last year (in various fields), but only got one interview, after which he never heard anything back.

Sorry for the rant, it's just all a bit demoralising.

Mr. Loverman

Yeah, it sucks...

Good luck.

davo10

dark crystal wrote: »

I don't even think he expects a pay rise every year, but after six years of working hard for this company, not to see even a small gesture from them is really bad form. They're clearly telling porkies about being on the breadline, which is even more infuriating.

He's looked for other jobs (his work history is in admin), but jobs in our locality in that sector are slim pickings. Most vacancies in that field have been swallowed up by jobsbridge schemes. He applied for at least half a dozen other jobs during the last year (in various fields), but only got one interview, after which he never heard anything back.

Sorry for the rant, it's just all a bit demoralising.

OP, you are not privy to outgoings for this company, you do not know what loans are outstanding/overdrafts etc, you are talking about a period during the worst recession in recent history and there is no guarantee that when those two contracts end, that they will be renewed. Businesses now are planning better and are more prudent with expenditure, they are amassing funds in case contracts dry up and profits decrease. Increased gross income does not mean businesses are flush with disposable funds, also as stated a raise in wages is not an entitlement, unless it is guaranteed in the employment contract, it is discretionary.

RomanGod

davo10 wrote: »

OP, you are not privy to outgoings for this company, you do not know what loans are outstanding/overdrafts etc, you are talking about a period during the worst recession in recent history and there is no guarantee that when those two contracts end, that they will be renewed. Businesses now are planning better and are more prudent with expenditure, they are amassing funds in case contracts dry up and profits decrease. Increased gross income does not mean businesses are flush with disposable funds, also as stated a raise in wages is not an entitlement, unless it is guaranteed in the employment contract, it is discretionary.

Might I just add that he works in administration, an area that has been taken over by job bridge schemes as you put it, he might not have the skills to warrant a pay rise. Loyalty is a trait not a skill so just because you stay with a company for years doesn't always guarantee an increase in salary. To be fair there are plenty of people out there who would be happy for a job full stop, let alone worry about how much they are earning. Be thankful he is employed and doesn't have to worry about job security

Mrs OBumble

OP, what sort of salary could get get if he moved to a job in another company? If it's no more than he's getting now, then his pay is about right.

Outside of government jobs and a person's first few years in the workforce, pay rises generally come thru labour market competition or taking additional responsibility, not just getting older.

THEBLACKDEVIL

OP, probably not much consolation to you but the company I work for has had a pay freeze for the past 7 years, the LRC agreed that company could not afford to increase pay rates, turns out they were right cause the company is closing at the end of the year with the loss of all jobs.

dark crystal

THEBLACKDEVIL wrote: »

OP, probably not much consolation to you but the company I work for has had a pay freeze for the past 7 years, the LRC agreed that company could not afford to increase pay rates, turns out they were right cause the company is closing at the end of the year with the loss of all jobs.

Sorry to hear that

InReality

Ideally/historically a union would be the counter-balance in this situation. Some industries still have national pay agreements I think , and there is the minimum wage as well. But in general a private company can have a pay freeze forever.

There is a huge power imbalance between a employee and a company , so the unfairness is built into that system.
But its a huge topic and comes back to political history, current politics and culture in the end.
Look at the difference between employment condition's in the US vs France/Italy/Spain.

Eoin

dark crystal wrote:

I was just wondering, are private companies allowed to set pay freezes for such a prolonged period?

As has been said, depending on what's in the contract, they don't even have to formally set a pay freeze at all. They can simply not give a raise. If your partner is not getting past the first round interviews, then maybe see if these skills can be polished up.

InReality wrote: »

Ideally/historically a union would be the counter-balance in this situation
...
There is a huge power imbalance between a employee and a company , so the unfairness is built into that system.
But its a huge topic and comes back to political history, current politics and culture in the end.

If you've a marketable skill-set and are more valuable to the employer the longer you work with them, you can reduce that imbalance considerably.

I would be very hesitant to work in a unionised company ever again though, I'm not sure that's the "ideal" counterweight.

InReality wrote: »

Look at the difference between employment condition's in the US vs France/Italy/Spain.

This is a good point - in the US, you can be marched out of the office with a box full of your belongings pretty easily. It's a lot harder to let someone go in Ireland. Anyway, I don't want to go any more OT.

@ THEBLACKDEVIL, hope you get sorted with something else.

Tarzana

davo10 wrote: »

OP, you are not privy to outgoings for this company, you do not know what loans are outstanding/overdrafts etc

Financial statements include this information. They have to disclose everything.

Beano

davo10 wrote: »

OP, you are not privy to outgoings for this company, you do not know what loans are outstanding/overdrafts etc, you are talking about a period during the worst recession in recent history and there is no guarantee that when those two contracts end, that they will be renewed. Businesses now are planning better and are more prudent with expenditure, they are amassing funds in case contracts dry up and profits decrease. Increased gross income does not mean businesses are flush with disposable funds, also as stated a raise in wages is not an entitlement, unless it is guaranteed in the employment contract, it is discretionary.

all of their financial information is public available.