salary cuts

Has anyone every cut salaries (i.e.5% reduction for all employees) accross the board because of bad ecomonic times at your company? If so, how was it done and how did affect employee morale and retention?


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  • Companies rarely do this as it effects the morale of every employee extremely negatively. Every one in the company views this as going backwards career wise. Could you consider giving no raises this year? Most companies will eliminate positions rather than make everyone take a pay cut. Or consider throwing the question out to the employees asking how can "we" cut expenses in order to avoid cutting salaries or eliminating positions. You'd be amazed at the cost savings people will come up with. Then they get to choose rather than the company. I'll be glad to discuss this further if you want to call me at 615-371-8200.

    Margaret Morford

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