Asked to work full time hours on 60%wage-can they do it?&what if made redundant

_gone_wild_

Hi there, Company I work for is cutting everyone salary by 40% ..some people more. But everyone is still required to work usual full time hours.
Can they do that? Is that even legal?

And what if someone will be made redundant? ...if there is 2 people on this same position- can they made redundant employee who is in the company longer or they would have to get rid of person who is less time first?

JimmyVik

_gone_wild_ wrote: »

Hi there, Company I work for is cutting everyone salary by 40% ..some people more. But everyone is still required to work usual full time hours.
Can they do that? Is that even legal?

And what if someone will be made redundant? ...if there is 2 people on this same position- can they made redundant employee who is in the company longer or they would have to get rid of person who is less time first?

Are they getting the government subsidy?

punisher5112

I'd be doing 40% less work....

Is there a union?

Might be time to seek legal advice and advise others to do same.....

punisher5112

punisher5112 wrote: »

I'd be doing 40% less work....

Is there a union?

Might be time to seek legal advice and advise others to do same.....

You missed the important question.

Is the business struggling?

If it is, a wage cut may be better than what could be an extended period of unemployment if this recession is as bad as they are predicting. The current level of unemployment payments is only for 3 months, though it may be extended. After that it is back to €203pw.

If the op is talking redundancies, the business may unfortunately be circling the drain.

Don’t cut off your nose to spite your face.

_gone_wild_

JimmyVik wrote: »

Are they getting the government subsidy?

Yes they are getting it....
There is no union unfortunately.

And yes, the business is struggling. In my case 40% cut would mean that what I’m getting would barley cover commuting to work and childcare.

The company is currently running on minimum staff levels, me personally I was laid of temporarily and they started from those who are still working.
But this is what’s going to happen with everyone.

It just doesn’t seem right...?

Steer55

_gone_wild_ wrote: »

Yes they are getting it....
There is no union unfortunately.

And yes, the business is struggling. In my case 40% cut would mean that what I’m getting would barley cover commuting to work and childcare.

The company is currently running on minimum staff levels, me personally I was laid of temporarily and they started from those who are still working.
But this is what’s going to happen with everyone.

It just doesn’t seem right...?

40% cut is pretty drastic, what sector are you working in?

punisher5112

Is it a small business or big multinational?

I can see many places doing exactly this to create even bigger profits.

JustAThought

punisher5112 wrote: »

Is it a small business or big multinational?

I can see many places doing exactly this to create even bigger profits.

Can you negotiate to do this work from home -at least you would save on the childcare? And you’d want a temporary clause and timeframe from HR -otherwise its just exploitation.There is also a possible case for constructive dismissal from the labour courts or whatever they call it now -worth making a call to citizens advice re the workplace comission.

punisher5112

punisher5112 wrote: »

Is it a small business or big multinational?

I can see many places doing exactly this to create even bigger profits.

Even bigger profits? You think many companies are going to be more profitable than they were a couple of weeks ago?

Which places do you see doing exactly this?

skallywag

punisher5112 wrote: »

Is it a small business or big multinational?

I can see many places doing exactly this to create even bigger profits.

Do you live in the real world or under a stone?

OP, while 40% does indeed sound excessive, it sounds like the business may have been in a very poor shape before this thing rocked in.

antimatterx

My company announced a pay increase freeze for year a few weeks back, as they predicted to be under target for Q1.

This week, they announced that they had exceeded Q1 expectations!

Shocking stuff imo

skallywag

skallywag wrote: »

Do you live in the real world or under a stone?

In a house. Your prejudice isn’t evidence.

Hyzepher

If the company is struggling for sales etc then why do they need everyone to maintain 100% capacity. Either they are busy or they aren't

ZeroThreat

Deleted User wrote: »

In a house. Your prejudice isn’t evidence.

IMO there always seems to be an abundance of thatcherites and IBEC types on these forums looking at many of the replies. You know the ones that weigh in on any thread from the pov that the employee is always wrong.

Outkast_IRE

antimatterx wrote: »

My company announced a pay increase freeze for year a few weeks back, as they predicted to be under target for Q1.

This week, they announced that they had exceeded Q1 expectations!

Shocking stuff imo

Plenty in the same boat. I work for a company that has greater than 10,000 employees worldwide and is an employee trust. Our region had an excellent year last year , and a profit share in june is based on the previous years performance.

The profit share is cancelled and pay freezes all around.

Augme

So there has been a massive drop in revenue/income while there hasn't been any drop in workload? There are very very few sectors where that could be possible. The first thing I would be asking why are your hours lot being cut by 40%?

manonboard

Are you in a position to quit?

40% is completely unacceptable. If you told them you would work 40% less for an indefinite amount of time and still expected 100% wages... you'd be told to go right off.

If you are desperate, stay. If you could manage without the job, i'd be quitting and looking else where. 40% is crazy money to be deducting. 10% is where i'd be drawing the line.

Hyzepher

Hyzepher wrote: »

If the company is struggling for sales etc then why do they need everyone to maintain 100% capacity. Either they are busy or they aren't

You missed the op’s post that company is running on minimum staff levels and he/she has been temporarily laid off.

manonboard

manonboard wrote: »

Are you in a position to quit?

40% is completely unacceptable. If you told them you would work 40% less for an indefinite amount of time and still expected 100% wages... you'd be told to go right off.

If you are desperate, stay. If you could manage without the job, i'd be quitting and looking else where. 40% is crazy money to be deducting. 10% is where i'd be drawing the line.

You would be looking for a job at the same time as the tens of thousands who have recently lost their jobs.

antimatterx

antimatterx wrote: »

My company announced a pay increase freeze for year a few weeks back, as they predicted to be under target for Q1.

This week, they announced that they had exceeded Q1 expectations!

Shocking stuff imo

The first quarter of this year was fantastic for a high percentage of companies, employment rates were extremely low, the economy was booming. Let us know what Q2 and Q3 are like in a couple of months.

It’s the new reality, companies could not dream that something on this scale could ever happen so quickly. It is not at all surprising that job losses and wage reductions will be widespread. For many without large cash reserves and/or a steady income stream during the next year, it will be all about survival.

Watching/reading economic analysts and forecasts here and in the US, it could be 2022 before we get back to where we were.

JimmyVik

Outkast_IRE wrote: »

Plenty in the same boat. I work for a company that has greater than 10,000 employees worldwide and is an employee trust. Our region had an excellent year last year , and a profit share in june is based on the previous years performance.

The profit share is cancelled and pay freezes all around.

Never waste a good virus seems to be the motto from most companies these days.
Mine are working out if they can make money from government subsidies even though they dont need it at all.

JimmyVik

JimmyVik wrote: »

Never waste a good virus seems to be the motto from most companies these days.
Mine are working out if they can make money from government subsidies even though they dont need it at all.

That is an astonishing post.

You think companies see this as a good thing?

Your company do not need to work out if they can make money from the subsidy. The Government is actually encouraging companies to use the subsidy if there is a 25% drop in income as a result of the pandemic. How do you make money from the scheme if you loose at least one quarter of income?

JimmyVik

Dav010 wrote: »

That is an astonishing post.

You think companies see this as a good thing?

Your company do not need to work out if they can make money from the subsidy. The Government is actually encouraging companies to use the subsidy if there is a 20% drop in income as a result of the pandemic. How do you make money from the scheme if you loose at least one fifth of income?

Mine does.
And they are working on getting the subsidies.
They will find it. They have done this kind of thing before.
Accountants and legal departments are built for this sort of thing.

Think R&D grants. That was a good one.

Multinational.
People are living in cloud cuckoo land if they think companies havent got all hands on getting any subsidy they can.

JimmyVik

JimmyVik wrote: »

Mine does.
And they are working on getting the subsidies.
They will find it. They have done this kind of thing before.
Accountants and legal departments are built for this sort of thing.

Think R&D grants. That was a good one.

Multinational.
People are living in cloud cuckoo land if they think companies havent got all hands on getting any subsidy they can.

Of course they are getting their hands on any subsidy they can, if there has been a 25% decline in orders/income. This has been well publicised.

Even the most creative accountant would struggle to make a 25% decline in business into a profit. That would be quite an achievement, even for your company.

Under normal circumstances, a sudden loss of at least 25% of orders/incomes would have enormous impact on any company. The fact that this may continue or even worsen in the months/years ahead would effect any company to the extent that job losses are inevitable.

I don’t see how you speculating on past accounting performance has any relevance to the current situation, even the 2008 crash was not as sudden and devastating as this.

Outkast_IRE

JimmyVik wrote: »

Never waste a good virus seems to be the motto from most companies these days.
Mine are working out if they can make money from government subsidies even though they dont need it at all.

I do think if any companies try any tricks in this regard it will only end on a sour note.

Out of all the government departments to mess with Revenue seems to be on the ball far more than the others and are quick to spot anything suspect.

JimmyVik

Dav010 wrote: »

Of course they are getting their hands on any subsidy they can, if there has been a 25% decline in orders/income. This has been well publicised.

Even the most creative accountant would struggle to make a 25% decline in business into a profit. That would be quite an achievement, even for your company.

Under normal circumstances, a sudden loss of at least 25% of orders/incomes would have enormous impact on any company. The fact that this may continue or even worsen in the months/years ahead would effect any company to the extent that job losses are inevitable.

I don’t see how you speculating on past accounting performance has any relevance to the current situation, even the 2008 crash was not as sudden and devastating as this.

I dont really care if you believe me or not. Just stating what I know and if you dont want to take it you dont have to. No skin of my nose.
So lets ignore that and pretend its not happening.



So we go back to the OP. Do you think his company is taking the piss by any chance? Im going to say that I do.

JimmyVik

JimmyVik wrote: »

I dont really care if you believe me or not. Just stating what I know and if you dont want to take it you dont have to. No skin of my nose.
So lets ignore that and pretend its not happening.



So we go back to the OP. Do you think his company is taking the piss by any chance? Im going to say that I do.

Sorry, going to have to call BS on any accountant able to make a 25% decline on business into a profit by using the wage subsidy.

Are they taking the piss? Depends on their financial situation, if they have suffered a catastrophic reduction in income and are in danger of closing, then no, I do not think they are taking the piss. The employees can reject the pay cut, if permanent lay offs/closure follow, then they will know that no piss was being taken. Of course by then, it will be too late and the employees join the hundreds of thousands on the live register.

JimmyVik

Dav010 wrote: »

Sorry, going to have to call BS on any accountant able to make a 25% decline on business into a profit by using the wage subsidy.

Are they taking the piss? Depends on their financial situation, if they have suffered a catastrophic reduction in income and are in danger of closing, then no, I do not think they are taking the piss. The employees can reject the pay cut, if permanent lay offs/closure follow, then they will know that no piss was being taken. Of course by then, it will be too late and the employees join the hundreds of thousands on the live register.

Fair enough. Dont believe it if you dont want to. It happens and is happening.
You're probably on defending Ryanair too.

The OPs company is still taking the piss asking for 100% of the work for a fraction of the pay. Thats called taking advantage in my book.

JustAThought

O.P.

In addition to the points I made before

Questions for your local tax office -

would the 40% pay cut take you into a different tax bracket or would you still he paying the same tax (assuming its high?)

are there any government incentives from the dept of social welfare that could make this less financially difficult for you - eg family income scheme

would you not (possibly) be better off
- going off sick ( what is your companys suck pay policy)
- going on a full time 3 day week and claiming the dole and employment stamps on the other 2 days as this would give you access to medical cards for yourself and all your children, free university education, rent allowance if you are renting, and the family grants for household income that tops your income up with a cash payment and leave you 2 days without needing childcare and gives you time to look and interview for another job in due course

If you leave and make yourself unemployed you will NOT be entitled to any social welfare payment such as unemployment assistant/ benefit. If you decline to work for 40% less because it puts you under extreme funancial stress with mortgage and childcare but make reasonable offers / solutions you would probably not be seen to be refusing work. Of course any dosser who never works just signs on and would not have this problem.

A 3 day week for the duration might be your best solution.

Someone I know was ‘offered’ a 4 day week for the crisis but they counter offered and suggested they use one holiday day a week and be paid the same amount as now and the company surprisingly accepted. The downside of this is that if they fire him he will not have the safety net of being paid out his holiday days along with his last months wages.

The upside is that of they go belly up he won’t be owed his holiday days!

I’d try and negotiate and do it on paper - and bcc yourself so you have something. I’d throw un my favourites - Under duress, placing under impossible financial strain, the question of the contract etc

I’d also be asking what is the end game - I’m not looking forward to trying to get a new job after this is over and taking the 100% financial hit while I look but equally I am not personally prepared in my foeld which is extremely high risk to risk my life and health by earning a pittance. But I don’t have a work from home option. I guess there will be a lit more competition for jobs after and lot more people prepared to play the race to the bottom salary bidding war after too - sadly. Might be worthwile to try and negotiate a short term reduction for a specific time only with whatever paypoint tax efficiencies and holiday day or working from home and overtime /holiday useages you can get. Or ask the workplace comission about constructive dismissal and them breaking the terms of their contract in advance.

Have you looked at last years annual report? What kind of reserves have they got and what kind of financial statements were they presenting then? This crisis is only a few months old - their declared strategy and financial accounting reports may give you the leverage you need to argue your point.

JimmyVik

JimmyVik wrote: »

Fair enough. Dont believe it if you dont want to. It happens and is happening.
You're probably on defending Ryanair too.

The OPs company is still taking the piss asking for 100% of the work for a fraction of the pay. Thats called taking advantage in my book.

No, It really isn’t, and I’m not sure what the Ryanair reference is about, has that something to do with the op?

I have never heard of a 40% reduction, the ops employer’s order book must have been decimated. The op will be able to gauge how bad things are in there, either directly or by talking to those who are still working. If the business is close to going under, this may be their only option. The op does not have to, or may not be in a position to accept the wage cut, but what is the alternative?

JustAThought

Dav010 wrote: »

No, It really isn’t, and I’m not sure what the Ryanair reference is about, has that something to do with the op?

I have never heard of a 40% reduction, the ops employer’s order book must have been decimated. The op will be able to gauge how bad things are in there, either directly or by talking to those who are still working. If the business is close to going under, this may be their only option. The op does not have to, or may not be in a position to accept the wage cut, but what is the alternative?

sue them for breech of contract - lodge a case and complaint with the workplace comission ( or whatever the labour courts are called now) - constructive dismissal and breech of contract.

JustAThought

JustAThought wrote: »

sue them for breech of contract - lodge a case and complaint with the workplace comission ( or whatever the labour courts are called now) - constructive dismissal and breech of contract.

And assuming the employees win, which would be by no means guaranteed, what happens if the company has gone under?

The op has already confirmed the business is struggling and has had to lay off staff.

JimmyVik

I think you've your head ion the sand a bit Dav010.
There are real problems out there for real people.
I would be more worried about them than companies.
Sure worry about companies, but people first as far as im concerned.
You've stated what your priorities are, but that is no good to the OP.
Sure their company might go bust at some stage, but the OPs issue is real and now and is effecting their entire family and im sure other workers families.

witchgirl26

OP generally for a reduction in salary, the company are required to get your consent. Is it a straight 40% across the board for everyone? Sounds very drastic. Is it for a defined short period or have they stated at all how long it will last?

Unless you're a essential worker, you shouldn't be travelling for work so maybe discuss with them working from home if it's an option which will help save on the commuting and childcare. In fact you shouldn't have any childcare costs at the moment as no creche is open or should be charging.

It might mean some hefty cutbacks in your personal life but weigh it up in relation to taking the cut. Get a moratorium on your mortgage for a few months if needed or if you're renting, talk to your landlord.

antimatterx wrote: »

My company announced a pay increase freeze for year a few weeks back, as they predicted to be under target for Q1.

This week, they announced that they had exceeded Q1 expectations!

Shocking stuff imo

Q1 ended at the end of March. Therefore most of the restrictions only were in place for 2 weeks at the end of Q1 and may not have had a material effect on the profits for that quarter. Q2 will be the hardest hit for most companies as that runs from April to June. The worst affected months for shutdowns etc.

My company had a good healthy P&L for Q1 but that has gone completely now because all of our shops are shut so no money coming in.

JimmyVik wrote: »

Fair enough. Dont believe it if you dont want to. It happens and is happening.
You're probably on defending Ryanair too.

The OPs company is still taking the piss asking for 100% of the work for a fraction of the pay. Thats called taking advantage in my book.

It can't happen to some huge degree. The subsidy restrictions are quite tight in terms of eligibility. You have to show that you expected at least a 25% drop in turnover. While the company may still technically be profitable depending on the costs that they have, it's not going to be some amazing profit coming out of it.
Plus they can't use the subsidy for anything other than going to employees. Employees must receive 100% of the subsidy granted to the company in respect of them. Currently yes Revenue are giving the €410 for all employees who the company are applying for but the difference between that & what the employee is entitled to (& is in their payslip) is to be returned to Revenue.

So unless you're actively involved in some nefarious scheme to some how make a profit out of this and thus that's where you're getting your information (& also acting fraudulently), you're talking out of your ass.

JimmyVik

JimmyVik wrote: »

I think you've your head ion the sand a bit Dav010.
There are real problems out there for real people.
I would be more worried about them than companies.
Sure worry about companies, but people first as far as im concerned.
You've stated what your priorities are, but that is no good to the OP.
Sure their company might go bust at some stage, but the OPs issue is real and now and is effecting their entire family and im sure other workers families.

You see, there you go again making unfounded assumptions.

There are real problems for everyone, employers and employees. What good is it worrying only about the person being paid and not the one paying which you acknowledge, may go bust? If the business does not survive, how does that benefit the employee? No job, no redundancy payment apart from the State’s.

I have not stated what my priorities are, I stated that what you posted is without foundation in reality. I find your cynicism that a company does not waste a good virus or that it benefits them in profit quite disturbing, after everything in the news over the past 2 months, you seem to have a very poor understanding of the effect on businesses.

antodeco

My company have had a 95% reduction in their revenue. Literally what they would do in a day, they are barely doing in a month. They are still paying everyone. They still paid everyone's bonus and gave wage increases, as these were based in 2019. They said they will continue to pay everyone full wages for as long as they can. They basically had a 6 month contingency built into their business and that's exactly what they are doing.

seamus

punisher5112 wrote: »

Is it a small business or big multinational?

I can see many places doing exactly this to create even bigger profits.

Perhaps some very big companies who are still doing business, will. Most won't, because they're not doing business. Some companies will take this as an opportunity to shut down chronically underperforming parts of their business. Other companies are pumping cash into other parts of their business, giving out wage increases and hiring to beat the band to take advantage of the opportunities.

You have a very narrow worldview of employment.

When I told someone my company had cut wages, their response was, "Bastards! You should go get another job offer, bring it back to them and force them to restore your pay".

Said person works for a huge company will billions in the bank. I don't. I know for a fact my employer has limited bank and revenue is literally on the floor. We may as well not be trading. The purpose of the pay cut is to keep everyone employed for six months instead of three. The government subsidy isn't going to magically make profit magically reappear for us, but it will buy us another few months of employment.

And a massive amount of companies are in this boat. Getting hard-nosed about it, talk of unionising and refusing pay cuts is a sure fire way to find yourself out of a job faster. If a company has no money, they have no money. Many of the union mindset believe that companies have an endless money pot, and duty is all one-way; from the company to the employee.

Phoebas

OP, if they are asking you to take a 40% pay cut but haven't laid everything out on the table about how the company is doing and why this is necessary, then I'd be very worried.

Only you can do the calculation about your prospects of picking up another job vs staying around, but if you agree to the cut, you might want to negotiate some conditions e.g.
- that some or all of it is deferred to be repaid at a later date.
- that the cut is temporary and time limited and you automatically revert to normal pay after a set date.
- that the company provide regular updates to staff about their financial position.