Reducing employees pay

TanyaE · December 2003

Need help!! Have questions about reducing employees pay because of a job change. This is a pilot that is going to be piloting a different charted plane that has a different owner. The owner will only pay $X amount of money for pilot pay which is different then the salary for the plane that the pilot was flying. Can we redunce that pilots salay since it is a different plane with a different owner? Need Help!!!!!!!!

Thanks,
T in HR

SMace · December 2003

A short anwswer is yes. But I have some questions. Why is he piloting a different plane? His choice? Your choice? Current route gone? Does he know? Are you unionized? Does he have an employment contract? Do you have a company policy dealing with pay? I think that can make a difference in how you handle it.

TanyaE · December 2003

The plane that they are currentley piloting in lbeing sold by the owner, so we are signed on another plane to our charter certificate that is owned by someone else. We will still have a plane for them to fly except the owner does not want to pay as much as the previous owner did. Our pilots pay is completely reimbursable by the owner. Not sure if the pilots have been informed yet and we do not have a union.

We do have a pay policy, but it mainly deals with regular and overtime pay. Nothing about pilots and pay on different aircraft. The pilots that we currently employ do not have contracts. And the state on Texas is an At Will work state. If that makes any difference.

Thanks for the help.

rad · December 2003

>We do have a pay policy, but it mainly deals with regular and overtime pay. Nothing about pilots >and pay on different aircraft.

You may want to update your pay policy to include this. This way, no one is surprised.

ray a · December 2003

When we have "demoted" ee's we have gone both ways. If the demotion was due to performance issues, and the ee was earning more than the max for the new job catagory, then we have reduced pay. If the demotion was due to changing workloads and not due to any problems with the ee, and they are still making less than the max for the new catagory, we leave their pay as is. The key is why the job change and where does the ee's pay fall relative to the pay scale.

TanyaE · December 2003

The reason for the reduction is becaause the owner of the new aircraft that we have brought on has a top out pay for what he will pay for the pilots and they both make more than what the owner will pay. So since the pilot pay in completely reimbursable if we keep the pilot pay as is, we would have have to eat the difference and the company can not do that.

SMace · December 2003

It sounds like yes you can give him the option to take the different route that is reimbursed at a different rate. I don't see you having any other option. Your pilot has the option to look for employment elsewhere if they like. If turnover and morale are an issue and they sound like they might be if this happens out of the blue, you may want to think about having something in place to keep their income steady. However, if this is normal in your business and pilots are used to it, I wouldn't worry.

TanyaE · December 2003

Thank you for your imput. I am currently getting more specifics from our charter department as to whether the pilots are fully aware of this when it comes to the owners and the salary reimbursement or not.

Thanks.

marc · December 2003

Some states have laws regarding written notice to EEs when pay is being reduced. In Nevada, it is 7 days. I don't know if Texas has a similar law, but it might be wise to check it out.

Pork · December 2003

TanyaE: This is a credentialed position, a professional position, which means that the ee is or should be an EXEMPT POSITION. Your company needs to value the time dedicated to flying your plane, and what part of his current salary your company is willing to pay for the valued flying hour. Another way to handle this issue is equate the salary of income earned against a set flying hour. When he flys for your company he earns income based on the flying hour. All waiting time and servicing time is built into the weighted flying hour value. You will have the official flying hours turned in to the aviation department supervisor, who will viaidate the flying hour; plug in the flying hour and out pops the earned income in the form of $ollars and $ents. The other company should also agree to the the same value and your piolet must also agree to the same value. You could also collect the valued flying hour from the other company, compute the flying hours together pay your employee and bill the other company for the shared person. I assume the other company is a part of your corporate body or there is a sound business relationship, otherwise, why would you be letting your full-time pilot work for another company?

Hope this helps!

PORK

TanyaE · December 2003

First we do not own these planes. We only manage them for someone else and we charted them out which makes money for us and the owner of the plane. The pilots are not paid per the hours they fly, but according to which type of aircraft they are flying and what the owner of the aircraft is willing to pay. Each type of aircraft is a different level of pay and the owner of the aircraft determines what is the max allowed that he will pay for a pilot to fly his aircraft. We have a plane that the owner is going to sell, therefore we will no longer have the plane available for the current pilots to fly. We will be getting another plane of the same type, but someone else owns it and he is not willing to pay the same amount for his pilots as the owner of the previos plane was willing to pay. So we need to evaluate the situation. We have a new plane, different owner, but same pilots. New planes owner does not want to pay as much for his pilots so we need to reduce the pay for the pilots or the department will loose money. My original question was can we reduce the pay for the pilots legaly? We are not a corporation we are a franchise. Not sure if it matters or not.

Thanks

Pork · December 2003

Tanya: I still recommend your company value the flying hour and pay your pilots, accordingly. Each type of aircraft brings with it a certain level of credentials and your pilots would all understand, and I have found, willing to be compensated based on a flying hour. Your aviation division is very much like a "people leasing company". Having been involved with this special set of characters, I wonder why your company would have an interest in this arena? Unless your entire company is an aviation service company and a easy pool of local credentialed pilots, who come to your organization to find them "contract hire flying hours" in which to practice a vocation and/or hobby.

"Dandy Don" was right on and identified your actions from your first post. It took this additional post for me, yet I still do not quite see the picture of how thye pilots interact with the rest of the company!

PORK

TanyaE · December 2003

We are an aviation company. We have and entire charter department with pilots that fly our charter aircraft. We are not an Airline like Southwest or American, but a Private/Corporate business.

T in HR

Don D · December 2003

If I am understanding, you work for a service that signs on a variety of planes for your employees (pilots) to fly. They are paid based on the pay schedule of the client for whom they fly. The client owns the planes, you do not.

It seems to me that pilots understand that not all piloting assignments pay the same and that they are apt to vary depending on flight schedules, type of aircraft, type of license required and other factors.

If the pilot is assigned to a different client he might have an option of accepting the assignment or declining it. What is your policy about that? Is it optional or is it mandatory that they accept an assignment?

Seems if its mandatory he would have a choice of continuing the employment relationship with your service or severing it.

In this regard, aren't these jobs therefore similar to any temp agency? Nobody is guaranteed to make the same money on every assignment.

Pork · December 2003

"Dandy Don" how in this world did you draw all of that out of this post? It reads like the experience, I had with Bill's Dollar Stores; WEW owned at one time 3 planes, a two engine gulf stream, a two engine t-200, turboprop jet, and a Comanchee single prop. We had 4 pilots and from time to time we had to have a contract pilot to fly pilot or co-pilot. The pilots new the twin jet engine required the highest ratings and paid the most money per flying hour. The Commanche paid the least and required the least credential to fly as pilot. Flying hours per pilot was the only way to keep it straight. They all knew what the ratings were and they kept very accurate flying hour information. All of them hating long trips in the Jet Stream because it called for a lot of down time and few flying hours. One would get there faster and wait longer, so it was not necessarily the best paying position. On the other hand, the Commanche took longer and had less down time than all of the planes, often it could produce the most income for the pilot and that was the price one had to pay to be in the plane business. I was so glad to get rid of all but the T-200 and WEW at the same time. May Bill rest in peace with the world for he caused a great deal of anger while he was in this world!

PORK

Don D · December 2003

Pork: I just did the best I could with the information provided. But, I'm trying to keep Bill's Dollar Stores out of the equation.

Pork · December 2003

AND RIGHTFULLY SO, THE NEED FOR AVIATION was one of the reasons why they went "belly up"! They will always remain apart of my HR experience, regardless of their downfall, it certainly was not due to a wild and out of control HR Department.

PORK

Reducing employees pay

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