Taking a voluntary 10% pay cut advice.

[f1nn]

On the 1st of September I got a phone call from my manager advising me that every one in my department was being given an option:

A. Work 4 days a week and take a 20% pay cut.

B. Work our normal 5 days and take a 10% pay cut.

The usual reasons were given, and to be honest, it's not the biggest suprise.

I was told not to make a decision there and then, discuss with wife etc, and come back to him at a later date.

He advised that there would be an email confirming this shortly.

I've heard nothing else about it.

I'm friends with someone at head office, and they tell me that a directive has been sent advising that everyone in my department is now on a 10% pay decrease, indefinately, effective from the 1st of September, i.e the date that the theoretical question was asked.


Now, I accept the end result is the same, but I think that there should be some form of notice period involved.

I am unsure what my colleagues have agreed to, but I've not agreed to anything and it is my understanding that a pay cut has to be agreed by the employee, as it is voluntary after all.

Before I agreed to anything, I wanted to see the proposal in black and white, so that I could ascertain what period this short pay was over as I'm keen for it not to be left indefinately. It would seem that my employers have gone ahead with it anyway.

Can any one advise if this is normal practise, and if there are any legal implications that I should be aware of?

[anonymous-user]

Yes you need to personally agree to it as it forms part of and is a change to your contract of employment. No they can't enforce it without your agreement. You can ask any questions you want. You have to agree the notice period as part of this process as well.

I suppose the real point is how much you value your career where you are and how easy would it be to find a new job.

Legally If they enforce this change without your consent then they are leaving themselves open to a breech of contract claim.

At the moment it seems alot of companies are either giving 0%-2% and no bonuses where the current financial climate has minimal effect. Quite a few are going down the route of reduced hours/redundancies where workload and demand has dropped (or is likely too). I haven't heard of loads but there are a few offering pay cuts, BA being one I think. In reality this is more than likley a change to a union agreed multi year pay deal, so in reality over the time period the pay deal covered there would still be a pay increase and it may not affect the progression opportunities just the basic inflationary amount.

If you are being offered a pay cut I'd really think about why they are offering it.

If their business model isn't sustainable why might this change?
If they're trying it on why would you still want to work for them?

Edited by anonymous-user on Monday 7th September 16:44

[M400 NBL]

I had a quick search on the ACAS website but couldn't find the relevant Q/A's.

Is the 10% cut for every employee, including senior managers?

[Andy_stook_2k]

Went through this in June this year, we had to sign a new contract for reduced working week and 10% less pay until the end of the year. We now work 4 days and its great if you can afford it.
It only affects staff at our place and shop floor are currently working normal hours.
No redundancies so far which is good but fingers crossed things pick up sometime soon.

[MKnight702]

If it was me I would go for the 10% cut for 5 days. My work did 4 day week with 20% pay cut for a couple of months (back to 5 now though). The only downside was what I actually ended up doing was working 5 long days for 20% less pay.