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Can employer make me take a 20% wage cut?

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Comments

  • Registered Users, Registered Users 2 Posts: 18,859 ✭✭✭✭_Brian


    McGiver wrote: »
    Can someone advise on this?

    https://www.citizensinformation.ie/en/employment/employment_rights_and_conditions/contracts_of_employment/change_job_contract.html

    Pay rates are covered as a contractual issue and cannot be changed without your specific agreement.


  • Posts: 0 [Deleted User]


    Augme wrote: »
    Important to remember there are plenty of businesses that are cleaning up because of this pandemic. And if they can convince their staff to take a 20% pay cut on top of it. Happy days.
    .

    Which businesses would those be?


  • Registered Users, Registered Users 2 Posts: 3,033 ✭✭✭skallywag


    Seve OB wrote: »

    Thank you for the link, I passed it on over the weekend and the chap gave them a call this morning, they have a number listed on their site. He just gave me a call to let me know how he got on.

    The feedback that he received was pretty much identical to that received previously, i.e. if the employer can demonstrate that he sincerely cannot afford to continue paying the staff at the current rate, then refusing the pay cut can most certainly leave you open to losing your job. There is actually also a paragraph there which makes mention to this:

    If you say you wish to continue working as before your employer may decide to make you redundant. If you are dismissed in this way, you may qualify to bring a claim for unfair dismissal. Unless your employer can prove there was a genuine redundancy situation and that fair procedures were followed, this dismissal may be found to be unfair.

    The employer himself has a very good reputation and is known to be very decent to the staff, and the majority of staff that you would meet who work there would speak highly of the place in general and their work conditions, etc. So I would imagine the need for the paycut itself is completely genuine.

    As for the terms of the job loss itself, he was told that the company had to cut costs in order to survive, and hence the team that he was working in needed to be downsized, so technically I guess he was made redundant. He has no issue with the separation terms that he was offered by the way, in fact they paid him out immediately also for the 2 month notice period which he has in his contract and just told him he can leave effective immediately. He also said that there is no issue concerning any redundancy payment which he is due etc.

    So they are the facts as I understand them today. I agree with the point made by Witchgirl in a previous post that if you have good reasons for making an argument against a cut then you might be successful in very special cases, but in general I would say that saying no just for the sake of it is not a good idea if you want to keep your job at the moment. The only thing that I would advise is that someone at least contact the source provided by SeveOB before doing so in any case.

    By the way, the citizens info lady did not say that it was completely black and white, so there could be an avenue to challenge it. Her opinion was that a successful claim would be 'very unlikely' in her opinion.


  • Posts: 21,179 ✭✭✭✭ [Deleted User]


    Usually in any contract I've seen is that the Company reserve the right to change the terms and conditions of employment which I would also take that to mean salary.

    You don't have to agree to it but could be seen as a breech of contract.


  • Registered Users, Registered Users 2 Posts: 7,517 ✭✭✭Outkast_IRE


    Usually in any contract I've seen is that the Company reserve the right to change the terms and conditions of employment which I would also take that to mean salary.

    You don't have to agree to it but could be seen as a breech of contract.

    It wouldnt be the first time a company wrote something in to a contract to suit themselves but doesnt actually comply with legislation or the law on that matter. Alot of these clauses when tested in court are not enforceable as they are contrary to law.


  • Registered Users, Registered Users 2 Posts: 29,220 ✭✭✭✭_Kaiser_


    My employer has asked for a 6-month 10% cut (same hours and workload) and confimed it's voluntary but like many others here have said, I'm under no illusion that refusing will mark your card either way.
    I'm not happy about it as it comes on the back of them enforcing mandatory 2 weeks leave on everyone as well recently, and I equally know that if it comes to it, reduncies will follow regardless of employee goodwill.

    I'm also not there 2 years yet so wouldn't get redundancy anyway if it comes, and I don't see a long term future with the place anyway but I don't want to be unemployed either.

    Honestly don't know what to do.


  • Posts: 7,712 ✭✭✭ [Deleted User]


    If they’re going to shaft you anyway if you accept then just refuse.


  • Registered Users, Registered Users 2 Posts: 4,724 ✭✭✭Treppen


    If they’re going to shaft you anyway if you accept then just refuse.

    This... either way they'll do what they are going to do regardless of the OP's stance.

    It kind of depends on the OP's standing in the company too, are they easily replaceable or not.

    Are they still paying their shareholders dividends?

    If they think their share price is in trouble then an employee share scheme is more carrot than stick.


  • Registered Users, Registered Users 2 Posts: 3,033 ✭✭✭skallywag


    _Kaiser_ wrote: »
    Honestly don't know what to do.

    We have the exact same situation, with forced holidays over Easter, and a pay cut for the rest of the year, in return for some additional paid leave.

    Sure, it is a pain, but it is certainly the lesser of two evils when I take a look to other people I know who have either lost their job already or have their hours cut in half or more.

    Under the current circumstances I really think that someone would be plain daft to refuse to be honest with you, unless there are truly exceptional circumstances which can be argued.


  • Registered Users, Registered Users 2 Posts: 1,830 ✭✭✭dennyk


    Usually in any contract I've seen is that the Company reserve the right to change the terms and conditions of employment which I would also take that to mean salary.

    You don't have to agree to it but could be seen as a breech of contract.

    Yeah, that isn't how contracts work at all. "I agree that the other party can unilaterally change any terms of this contract at any time..." ain't going to fly in court.

    The most likely scenario if an employee doesn't want to accept the pay cut is going to be a redundancy, if the business is really in a bind and can't continue while paying people's original salaries. While an employee made redundant in such a way might be able to challenge it, they may not be successful unless the employer does something foolishly obvious like hiring someone else (at the lower rate of pay) to replace them within a short time; one of the suitable reasons for redundancy is that the employer has decided they need fewer staff to carry on the business. If they just made the remaining employees shoulder the work of the redundant employee going forward and didn't hire anyone else until business actually increases again in the future, it would likely be considered a valid redundancy.


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  • Registered Users, Registered Users 2 Posts: 29,220 ✭✭✭✭_Kaiser_


    Update on my post above.

    Despite being pitched as a voluntary cut, it turns out they're running it as opt out and that if you don't respond, they'll presume consent. Worse, when trying to access the details on line you have to accept before you can view it.

    I've thus emailed one of the directors for a chat as I was under the impression that a company cannot just force you to take a cut.


  • Registered Users, Registered Users 2 Posts: 3,033 ✭✭✭skallywag


    _Kaiser_ wrote: »
    ...Worse, when trying to access the details on line you have to accept before you can view it. .

    As in you have to accept to take the paycut before you can see the details of the same?


  • Registered Users, Registered Users 2 Posts: 29,220 ✭✭✭✭_Kaiser_


    skallywag wrote: »
    As in you have to accept to take the paycut before you can see the details of the same?

    Yup.. it pops up like a disclaimer and I (half expecting this would happen) clicked OK after getting pushed back by my own manager and it then shows that you've confirmed.

    When you then open the details it's phrased as opt-out and if we don't hear from you it's deemed accepted.

    To be honest I'm inclined to refuse on principle at this stage.


  • Registered Users, Registered Users 2 Posts: 5,367 ✭✭✭JimmyVik


    _Kaiser_ wrote: »
    Yup.. it pops up like a disclaimer and I (half expecting this would happen) clicked OK after getting pushed back by my own manager and it then shows that you've confirmed.

    When you then open the details it's phrased as opt-out and if we don't hear from you it's deemed accepted.

    To be honest I'm inclined to refuse on principle at this stage.


    Record all that and in a year or two go to a solicitor to get back all the back pay you didnt actually agree to being cut.


    My company sent a mail around asking people to take 10% cuts. I got a few calls from some of the guys saying that they volunteered for a 10% cut in 2009 and never got it back. While others still there who never took the cut were are laughing at them now.


  • Registered Users, Registered Users 2 Posts: 29,220 ✭✭✭✭_Kaiser_


    JimmyVik wrote: »
    Record all that and in a year or two go to a solicitor to get back all the back pay you didnt actually agree to being cut.


    My company sent a mail around asking people to take 10% cuts. I got a few calls from some of the guys saying that they volunteered for a 10% cut in 2009 and never got it back. While others still there who never took the cut were are laughing at them now.

    I did ask about "getting it back" at some point but apparently that idea was already rejected. Even less reason to accept IMO but especially as the way they've gone about it isn't sitting well with me.


  • Registered Users, Registered Users 2 Posts: 3,033 ✭✭✭skallywag


    _Kaiser_ wrote: »
    Yup.. it pops up like a disclaimer and I (half expecting this would happen) clicked OK after getting pushed back by my own manager and it then shows that you've confirmed.

    When you then open the details it's phrased as opt-out and if we don't hear from you it's deemed accepted.

    To be honest I'm inclined to refuse on principle at this stage.

    OK, if you cannot read the details before accepting or not then that is downright disgraceful. I am no employment law expert but I believe that is completely illegal.


  • Registered Users, Registered Users 2 Posts: 1,238 ✭✭✭ffocused


    OP I had a similar issue during the last recession.

    I was asked to take 2 pay cuts within 3 months, accepted the first one and did not agree to second one.
    Company forced it through regardless and I checked with a solicitor.
    Solicitor confirmed it was illegal, but if I took it to court the judge was likely to side with the company due to the recession.
    I then went and got another job and handed in my notice.
    One week before I left, the company went into administration.


  • Registered Users, Registered Users 2 Posts: 3,033 ✭✭✭skallywag


    ffocused wrote: »
    Solicitor confirmed it was illegal, but if I took it to court the judge was likely to side with the company due to the recession.

    This sounds similar to advice that an acquaintance of mine received when he called the Citizens Information line last week. If you refuse to take the cut then you can very likely be made redundant afterwards. Yes, you can challenge this legally, but if the company can demonstrate that it is really necessary in order to continue operations, then the chances of a ruling going in your favour in the current climate is very unlikely.

    All in all I think we have little or no pragmatic choice at the moment rather than take a cut. That said, the way the company in _Kaiser_'s case is handling this is absolute bolloxology.


  • Registered Users, Registered Users 2 Posts: 1,819 ✭✭✭howamidifferent


    I've been asked to take a 20% cut for six months but have sent back a firm no.
    Pay rises where I work have been denied many years even prior to the last recession and again for the past two years.


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  • Registered Users, Registered Users 2 Posts: 5,367 ✭✭✭JimmyVik


    I said in another thread and got jumped on by "company men" who think companies do no wrong.

    Many companies will not waste a good recession, even if they arent impacted.


  • Registered Users, Registered Users 2 Posts: 1,192 ✭✭✭kennethsmyth


    JimmyVik wrote: »
    I said in another thread and got jumped on by "company men" who think companies do no wrong.

    Many companies will not waste a good recession, even if they arent impacted.

    Have to agree here, however there will be also many companies in trouble.

    One thing to note for all employers is that if you are paying staff say 70% or a reduced salary and they are still working and you have not gotten consent you could be taken to WRC or labour court later on. Most employers are aware of this but maybe not the next sentence.

    If an employer is topping up the wage to say normal payment net but part of this is a covid payment that has yet to be taxed and will be later an employee could still show that the employer is not paying the full net pay due to them and has done so without consent. Now this is only due to employers who can afford to pay as in reality an adjudicator will take the companies situation into account. However it does point out the subtleties of this covid payment and that its being paid net.


  • Registered Users, Registered Users 2 Posts: 1,192 ✭✭✭kennethsmyth


    _Kaiser_ wrote: »
    Update on my post above.

    Despite being pitched as a voluntary cut, it turns out they're running it as opt out and that if you don't respond, they'll presume consent. Worse, when trying to access the details on line you have to accept before you can view it.

    I've thus emailed one of the directors for a chat as I was under the impression that a company cannot just force you to take a cut.

    Just been on covid meeting with one of the big 4 and an opt out is totally not acceptable - must be by given consent.


  • Registered Users, Registered Users 2 Posts: 3,033 ✭✭✭skallywag


    Just been on covid meeting with one of the big 4 and an opt out is totally not acceptable - must be by given consent.

    This is also my understanding, and in our case we need to sign a document which gives said consent.


  • Registered Users, Registered Users 2 Posts: 6,017 ✭✭✭JDxtra


    My wifes company are doing the same - 10% to 15% cuts across the board. They say no consent is required, if you want to opt out you have to email the head of the company in Ireland! They expect 99% compliance. Anything less and they'll move to redundancies. Staff are all still working full time and operation is profitable.


  • Registered Users, Registered Users 2 Posts: 3,033 ✭✭✭skallywag


    JDxtra wrote: »
    Staff are all still working full time and operation is profitable.

    If the monthly figures are still profitable then I would really question the move.

    In our case our sales are down by 50% and we are bleeding money at the moment, the owner put in 200 mil of his own cash to pay salaries for the next 3 months, with the 5% cut coming in from July onwards.


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  • Registered Users, Registered Users 2 Posts: 3,339 ✭✭✭antimatterx


    Our company beat Q1 expectations, and there's not a hope in hell that we'll be taking a pay cut!


  • Posts: 0 [Deleted User]


    Our company beat Q1 expectations, and there's not a hope in hell that we'll be taking a pay cut!

    I suspect a lot of companies beat Q1 expectations, will they beat Q2,3 &4? If you work for Amazon, maybe.

    In case you’ve missed it, the ass just fell out of most economic markets world wide.


  • Registered Users, Registered Users 2 Posts: 3,033 ✭✭✭skallywag


    Dav010 wrote: »
    In case you’ve missed it, the ass just fell out of most economic markets world wide.

    Strongly agree.

    Some posters on this thread are incredibly naive. You do not need to be a 'company man' to see why these measures are required.

    I can only repeat what I have said multiple times. Refuse a reasonable and well presented (as in the facts as put on the table, and you need to consent) pay cut at your peril, and expect to be made redundant. You will not have any comeback, unless you have exceptional circumstances,I have confirmed this today myself with the Citizen Information line, I actually called them myself now as well to get clarity.

    Do you think I wanted to take a paycut? No. Was it the sensible thing to do? Yes.


  • Registered Users, Registered Users 2 Posts: 4,724 ✭✭✭Treppen


    Everyone takes a pay cut for 6months , boss pockets the money. Declare bankruptcy.


  • Registered Users, Registered Users 2 Posts: 18,928 ✭✭✭✭bucketybuck


    Our company beat Q1 expectations, and there's not a hope in hell that we'll be taking a pay cut!

    Thats incredibly shortsighted, it isn't Q1 that companies are worried about.

    Our Q1 figures were fine as well but figures for April show we are now operating at a loss. We have committed to keeping all staff still employed with wages supported by the COVID scheme and will continue to do that as long as we can, but the simple reality is that revenue has dropped and costs will need to fall in line.

    Complain about potential 10/15% wage cuts if they want but frankly it would suit us better to cut costs through redundancies, so anybody complaining should be careful what they wish for.


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  • Registered Users, Registered Users 2 Posts: 1,097 ✭✭✭rn


    One of the legal acceptable ways of differentiating staff for redundancy is if they've different contracts. Salary reduction needs consent. Withhold it and you differentiate yourself.

    There's numerous ways to look at it. Perhaps your physiologically ready to leave the organisation anyway and this could be the "push" combined with a redundancy payment to change your life. Especially if you've many years service and you're financially relatively secure.

    You'd definitely be hurt when this is proposed and this is a time when you are stressed anyway, so it's really tough.

    While people think it's clear cut legally and it might well be, the only people who win going down the legal route are solicitors and barristers.

    You can always accept it and move on as soon as a new opportunity arises, at least you've cash coming into your house while you are searching and you don't have hassle of meeting solicitors etc.

    Remember to see if a company can survive this crisis, profit in 2019 or Q1, 2020 is as not very useful because they tell the story of the past. What's a better metric is cash reserves and cash flow into company. Usually profit and cash are linked, but cash tends to move in "real time", whether profit is only available at end of a quarter /year. If your company is really in trouble it's cash flow in will have reduced and they could be using up cash reserves to meet cash out commitments eg to buy materials to keep production going and pay salaries.


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