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Is it ever appropriate for an employer to force an employee to take a pay cut for performance-related reasons in a technical field, even if the employer relies on subjective evaluations and refuses to implement more objective employee performance benchmarks?

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    Normally, you start out at a salary and then get pay raises. The reverse situation - starting too high and then getting "offered" a lower salary is just not a good situation for anyone. Accept the pay cut if you must but then immediately look for other opportunities and move on. – Brandin Aug 29 '15 at 12:57
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    Sounds like they made you an offer to hook you, and now they are trying to renege on that offer. That would make me take a long, hard look at my future with that company, as you have no guarantee that that is where it will stop. – Moo Aug 29 '15 at 13:40
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    If the going market rate for your position is truly an average of 120% of what you are making, and they are demanding a 15% cut, look for work elsewhere. Let them know there are no hard feelings and you'd have really liked to make a career with them. In a year, email the partner, ask him how he's doing, how are the wife and kids and oh by the way, did they ever find a more junior person to fulfill their wishes? – CGCampbell Aug 29 '15 at 14:17
  • Thanks Brandin and @Moo. I've been wondering if they do this often: offer a higher salary to attract top talent, then reduce it as a cost cutting measure. I agree that if I choose to stay (for now), I cannot trust them and must move on as soon as possible. – John Aug 29 '15 at 14:50
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    Yes that. Don't burn your bridges, ever, unless something is irrecoverably egregious. After all, if you're right, they may (will) not be able to get what they want, even at your current rate. Shock to them. However, let's say you've misread the market/economy. What if you can't get another job at your current rate, but end up taking that 15% pay cut anyway? You'll still want their good will. Right now there is a misunderstanding at best, and a disagreement at worst. If you push them, it doesn't hurt them, you're forgotten in a week. It hurts you. – CGCampbell Aug 29 '15 at 15:34
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On the one hand, 85% of my salary is still enough to survive, but on the other hand, the market rate for my position is about 120% of my original salary. Plus, this whole fiasco raises serious questions about the company's trustworthiness and ethical outlook. What should I do?

If it were me, I'd do the following:

  • Start looking for a new job immediately
  • Delay my response to the supervisor and partners as long as possible
  • Resist taking a pay cut as long as I thought I could
  • If it seems inevitable, negotiate a lesser pay cut
  • When forced to do so, accept the cut in salary
  • Resign the moment I found another job that I liked and that met my market rate

If your understanding of the supervisor and partner motivation is correct, and your assessment about your market value is correct, I agree with the questions raised by this sort of action.

At a minimum, the company doesn't know how to hire good people at the relevant prices. At worst, there is something else going on here that they aren't divulging.

It's not the kind of place I'd want to be, so I'd remain on their payroll only as long as it took me to find a better job.

  • Someone once said that if you are paid below market rate and can't get a raise (let alone a pay cut), then maybe the problem is in you. – Juha Untinen Aug 29 '15 at 23:06
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    My experience says that managers like this don't know what they're doing, and so try to compensate by kicking around their employees without any rational reason. I'd try to politely start questioning them along the lines of, "Oh? What specific metrics are you using to evaluate my performance, so I can try to fix things, and meet your expectations." Make them give you concrete goals. Then meet these goals, and RECORD what you do to meet it, and if they try this again, tell them, "Well, I've done X, Y, and Z, and finished on these exact dates, as according to our last conversation." – Kai Aug 30 '15 at 4:46
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    This smacks of a company in financial trouble. Get out now. – HLGEM Aug 31 '15 at 21:23
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The easiest way to counter this, what i consider to be very disrespectful and unprofessional behavior, is to ask what criteria your performance is being judged on, why it is considered not productive enough, e.g. what deadlines or performance goals you are missing and for a formal review in writing.

Either they have performance metrics they can/are measuring you on or they do not, based on your original question I would guess they do not and are just taking their chances. The only way I would actually take a pay cut is if they actually had a formal performance review and could show me that i wasn't actually performing at a high enough standard based on productivity metrics.

But what ever you do, start looking for another job immediately.

  • Thanks @user1450877. They do not have performance metrics--and they've acknowledged that. I work in a technical field, and the partners are non-technical people. They rely on my supervisor's subjective evaluation to measure my performance. I suggested, then tried to introduce a more objective system (something that should be my supervisor's responsibility), but they won't adopt it. I will definitely start looking for work elsewhere... – John Aug 29 '15 at 22:02
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Tell your supervisor that you thought about it, and it would be a much tougher decision if he takes a 20% paycut himself. That should impress his management a lot more. If he doesn't like the idea, keep insisting on an explanation what would be bad about that idea.

What you should do: Start looking for another job immediately, because you and your supervisor cannot both stay at that company. By the way, put your work efforts down to normal. Your supervisor doesn't appreciate it, and you are only killing yourself.

Your goal shouldn't be to make enough to survive. Once in my long history a potential employer asked me how much I would need to survive. I gave him an honest answer, added that I would want twice as much to work for him, and he accepted.

So if you accept the fact that you and your supervisor are not both staying at that place, tell the partner that you had enough of that nonsense, and you want either a 10% rise or you'll be finding a better job elsewhere. Look, the fact that you even consider working for less indicates to that partner that your supervisor is telling the truth. Asking for 10% more makes it blatantly clear that your supervisor is clueless.

  • Thanks for your thoughts; I really appreciate you sharing them! I don't think asking my supervisor to take a pay cut will work. He's been working there for a long time, and perhaps they're lying, but they told me they're not strapped for cash, they simply don't value my work. I will certainly scale back my efforts and begin looking for a new job immediately. I also agree that my goal shouldn't be to earn enough to survive. I suppose I phrased it that way because of their attitude toward employees: "work for us because you're passionate about the work; your salary is irrelevant." I resent that. – John Aug 29 '15 at 14:47
  • Joe, it's obvious that the supervisor wants to get brownie points by saving 20% salary cost. There are no performance issues; we all know that. So he is bullshitting. But he is not the decision maker. The decision makers have to be told clearly that he is a bullshitter. John, you can be passionate about your work. The salary is the reason why you work for them, not for someone else. (There are other reason, but your supervisor is obviously a huge negative in the company. With that kind of supervisor, they must pay MORE than other companies). – gnasher729 Aug 29 '15 at 17:48
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    Thanks guys. gnasher729, the supervisor is a bullshitter, but he's literally been working there 100 times longer than I have (109, to be exact), just not in a managerial capacity that whole time. So this partner has a rapport with him and trusts him. I'm fighting an uphill battle... I'm not sure asking for a raise is the right approach either, @JoeStrazzere. I just want to keep my salary, then find a new employer that's a little more trustworthy. – John Aug 29 '15 at 21:58
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Yes, you should be looking for a new job if that's how they're treating you.

In the meantime, there are two people you need to speak to.

  1. Your Union Rep. They should be able to explain to you your legal rights in this situation - and whether they can offer any assistance.

  2. The HR department. Talk to them about the company's policy on pay and performance. It is entirely reasonable for them to say that your pay is related to performance - but it has to be contractual and legal.

While looking for a new job, find an employment lawyer (your union can help with this) and look at whether this constitutes Constructive Dismissal.

All that said, if you don't want to look for a new job - ask your boss to put down in writing exactly what performance goals the company expects of you. E.g. answering all customer queries within 30 minutes, receiving no negative feedback from suppliers etc. Only when you know what they want, can you understand if you truly are underperforming.

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    John's profile indicates that he's in the tech industry in Washington State (Seattle). It's unlikely that he has a union rep (unions in the tech industry are rare in the US), and AFAIK laws in the US around Constructive Dismissal are not as favorable to the employee as they are in the UK. – alroc Aug 29 '15 at 16:54
  • Thanks for your feedback @Terence Eden! Unfortunately there is no union for my line of work, and I work for a small-ish company with no formalized HR department. I have been consistently requesting performance benchmarks in writing, but they refuse. I think I have a duty to work at a certain level of productivity--which I have surely been exceeding, but there is no quantitative metric. – John Aug 29 '15 at 22:13
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Do not take a pay cut.

Your are only 12 weeks into the job. They should tell you what to improve on and give you an opportunity to do that.

This is unfair and I would suggest get that CV to other companies.

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Going straight to a pay cut with no performance discussion is just odd. A pay cut in general is just odd. If you were hired into one position and did not perform and they offered another lower level position and told you the pay for new position is lower then maybe. You are doing the job your were hired into and they have not given any performance issues other than not productive enough. You know your performance has increase but your supervisor still suggested you have not improved. They should be telling you specific expectations of the position you are not performing and help you improve. Not fair but not much you can do about it. Stay calm and find a new job.

  • Thanks @Frisbee. Yes, I agree! It's very strange! I never had a performance review until they first tried to cut my pay--in fact, I've had very little feedback at all. Given everything they've said in the wake of what's been happening, and the fact they cannot give me specific examples of how to "improve," I sincerely do not believe my performance has anything to do with this situation. I think you're right... stay calm and move on. – John Aug 29 '15 at 22:09

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