A reader writes:
In the wake of COVID-19, my large company has been told that “tough decisions” are ahead, and that they would first start by asking us to to take voluntary pay cuts. The more of a pay cut that everyone takes, the fewer people will need to be laid off.
Here’s the catch — we get to pick the pay cut. While I think I am fairly paid for my experience, and I wouldn’t mind taking a temporary pay cut to save my job or others, my company is notoriously tight-fisted with salaries and I have fought hard for the raises I have gotten during my tenure.
Of course, I want to do my best to prevent layoffs of myself or others, but I don’t know what percentage to say. Do you have any advice on how I can navigate this?
Ugh, I don’t like this at all.
I’m sure the argument for this is that people can volunteer according to their own financial situations — one person might be in a position to take a significant cut because their spouse has a high-paying and secure job, while another person has multiple dependents and no savings, and so forth.
But with everyone deciding on their own what they’re willing to do, you’re going to get lower-paid people who take larger cuts than higher-paid ones … and people who contribute significantly more to the company taking larger cuts than the slacker down the hall who watches YouTube all day.
And that’s before we even get into all the data showing that women and people of color are less comfortable asking for money than white men are, and how that might play out here (potentially even in ways that put the company at legal risk). Read more here…
Source: Ask A Manager