Pay reductions
6274086
25 Posts
Can someone point me in the right direction here? We are a NYS company over 50 employees and management has asked me if we could do pay reductions across the board for anyone making over $70,000/ year but they would like to class out our billable people( and not cut their pay) since they are 100% reimbursable. I am researching but cannot find any written details about this? Any help would be greatly appreciated.
Comments
Unless those employees have some type of contract with you, you can change pay. And even possibly depending on how the contract is written. Most states however will not let you do so retroactively.
The only thing you would need to watch for is "disparate impact" -- that is are all the billable employees male?
We just had major pay/benefit cuts....it has been disheartening at times. But most employees are bouncing back and happy to have a job at all.
I wouldn't really worry about disparate impact here since there is a good and obvious business reason for exempting billable hour employees. It could, however, raise an eyebrow as to why it is that all the billable hour people are male, which would have more to do with hiring and recruitment practices than this particular decision althoug it would also make this particular decision look worse, too. hehehhehe
In any event, you can change pay going forward in the absence of any contract. Typical pay agreements stipulate that the comp plan can be changed. Typical handbooks say the rules are whatever the company says they are.
The employee that we don't want to cut are at specific locations that the owners/developers are reimbursing 100% (we are in construction), other jobs and overhead employees are the ones we need to target so we have a clearcut formula. The ages and ethnicity varies on all jobs and we actually do have some females on sites. We already started with the executive levels and they are voluntarily taking large cuts. Then I am going to formulate percentages based on salary levels. Trying to maintain consistency is my focus. I agree that employees are actually taking all of this very well and are extremely grateful for having a job. When business comes back- they know they will be taken care of. Unlike the big three auto companies taking their private jets- how can employees stand working for these guys!
Thanks for the advice.
[}]Just a pat on the back, because it is not easy being the one who has to analyze all of the numbers. Luckily I didn't have the final decision making power, but still I was the one who got to communicate the nitty gritty details of the changes.
Thanks, I just feel that it is my responsibility as the HR person to advise them properly of any potential issues. Sure enough we had one gentleman hire an attorney and say he was let go due to age discrimination. It was nice to have the analysis so we could quickly state that it passed on all accounts and mentioned several others factors. Hopefully, this won't even make it to court.