My employer has not said it is temporary, just that it will be reviewed in three months. Any agreement reached between the parties must be recorded in writing in case there is a dispute later over what was agreed. "You should ask your employer for details of the reduced business activity, who else has been asked to reduce their hours of work or pay and what were the criteria for selection.". Unfortunately, an employer can typically cut your pay at any time, especially if you’re an at-will employee. order back issues and use the historic Daily Express We will update these pages once their full significance has been evaluated. An employer can whittle down your salary anytime for one reason and the […] I am a vulnerable adult and struggling to live on what small wage I do get. This means that a pay cut can only be unilaterally applied across a … The employee, or the employer, could also agree a phased reduction in pay with the potential for a review and increase in the future, to try to incentivise the employee to remain and retain the relationship. It will largely depend on the terms of your contract as to whether your employer can reduce your hours and pay. To take a pay cut. Legally, an employer cannot impose a pay cut upon its employees if they have an employment contract that sets out details of their salary entitlement. An employer can cut an employee’s pay as long as an employer follows FLSA minimum wage and overtime regulations and salary basis requirements. Alternatively, if anyone over the age of 40 got a pay cut, but … However, employers are not obliged to do so. One year's annual leave must be taken by the end of the year. My security company will have to reassign me to a different location, but aren't willing to pay me my current wage. But do you have to agree to this request? When your employer has a downturn in business or there is less work for you to do, your employer may ask you to take a pay cut or to work fewer hours. Make the most of your money by signing up to our newsletter for. Q I have worked for my employer for 25 years. For more clarity in regards to the legality of this situation, I suggest speaking with your local labor board. If your employer asks for your consent to reduce your pay – and you do not accept – they may opt to terminate your contract on notice. But can an employee unilaterally cut employees' compensation packages? Furlough: Can you rotate staff on furlough? Otherwise there is an automatically unfair dismissal as a result of the change in salary. UK employment law questions answered by verified Experts. He said that everyone has had hours cut but when asking other workers they have not had hours cut. Implement pay cuts to avoid redundancies Key points. Employers will sometimes propose a cut in hours to match the pay cut. As an employer, when can you legally reduce your employee's pay? Who can be furloughed? Noone can cut your pay or hours without your permission UNLESS there is a term in the contract called a variation clause. I’m a senior executive working in management consultancy and have been asked to take a 10 per cent pay cut. 20th Mar 2020 Today we learned that our employers measures to prepare for the Covid-19 slump is that we are to take a 40% pay cut and we must still do the 40 hours/week. Employers should only use these clauses to vary a contract if they have a good reason, for example the business is struggling financially and needs to cut staff hours. Now many employers are asking staff to take a pay cut or to reduce their hours. With the economy sitting at a standstill and revenue streams drying up, companies are looking for ways to reduce costs. This can happen where the employee’s salary was originally negotiated on the basis of an expected level of performance which, if not met, meant the salary would … Pay cut agreement between employer and employee. "You should ask your employer for details of the reduced business activity, who else has been asked to reduce their hours of work or pay and what were the criteria for selection. Pay cuts If your employer is considering cost-cutting measures that includes pay cuts, then a pay cut shouldn’t be imposed upon an employee without their consent. It is illegal in the UK to impose a pay reduction without consent. At least that way, the employees still remain in work. A No. The employer will not be dismissing them on the grounds of a redundancy situation: ie, a diminishing requirement for a particular kind of work, workplace closure or business closure, but on the basis of the refusal to accept a pay cut. When there is no prior notification about the pay cut. In the current economic downturn, employers are keen to find ways to save money and try to stay afloat. Speak with an accountant to see how you can maximize the benefits and paycheck you have, perhaps by increasing your contributions to "cafeteria" plans or raising deductibles. Most workers who work a five-day week receive at least 28 days of paid annual leave a year. An employer can cut employees' pay if they consent to the change to their contracts. Many public and private firms pay workers a London Weighting element which recognises the additional costs of living and working in the capital. Instead of redundancies being the first port of call, many employers have sought to reduce the salaries and benefits of current employees. When the base salary is higher than the minimum wage, the employer cannot reduce it … The Government has put in place the Coronavirus Jobs Retention Scheme, which promises to pay up to 80 per cent of wages for those who are not working but kept on payroll. But do you have to agree to this request? If you are a key worker working in essential health, social care or other essential services and are unable to home, you can work and travel to work, according to Citizens Information. Your employer can cut back on your hours if it says they can in your contact.If it doesn't, they can't do this without you agreeing first.Again, you can refuse a cut in hours but that may mean an end to your contract completely if they can't afford to keep you on.There must be a fair consultation period before they come to this decision.The Jobs Retention Scheme unfortunately only applies to those who can no longer work at all.However, you are entitled to guarantee pay during short-time working.This means you can get £29 a day, but the payment is limited to only five days in a three-month period. Everyone else must not leave their homes unless they are buying essentials, seeking or offering medical or necessary help, or going out for one form of exercise a day. Rishi Sunak warned of economic 'tipping point' amid Cabinet row, It’s time to get behind the Government, says LEO McKINSTRY, Coronavirus crisis sparks RECORD job losses in ‘paralysed’ Spain. CAN MY EMPLOYER IMPOSE A PAY CUT? First, an agreement should be obtained in light of your employer's financial position and, possibly, as a way of avoiding redundancies or other more severe steps. Solicitor: Ben Jones, UK Lawyer replied 9 years ago. Article 35 of the Labor Contract Law provides that the terms and conditions of … Express.co.uk brings you all the information you need to know on your rights during these tough times. An employer cannot force an employee to accept a pay cut. As a pay cut will be a variation of the employees' contracts of employment, the employer should seek the consent of the employees to the change. Cleaner - 30-Mar-19 @ 7:15 AM. It is illegal in the UK to impose a pay reduction without consent.Shân Evans, of People Management, explained: "Legally, an employer cannot impose a pay cut upon its employees if they have an employment contract that sets out details of their salary entitlement. If I step down from this position, can/will my employer decrease my pay to what it used to be? I have worked for a security company for over 5 years. Can my employer cut my pay? An employer is prohibited from making any cuts to workers who make minimum wage (NIS 3,800 a month), even if the employee agrees to it, since it's against the law to pay less than the legal minimum. For instance, if you complain that your boss is sexually harassing you, and then your pay is cut, that is called retaliation and it is illegal. Premier League average salary: How much do players earn each week? Can companies get away with imposing pay cuts? Consulting with employees and reaching an agreement is best to avoid these claims. However, you are entitled to guarantee pay during short-time working. Generally, it is unlikely an employer will be able to lawfully impose a pay cut without consulting with employees first. Your employer isn't entitled to simply bring in any change they wish. An example of a discriminatory pay cut would be if all men got a pay cut, but no women. They are trying to force me to take a 4 dollar pay cut which I can not afford. During these difficult times, it may be essential for your company to cut costs - and pay cuts may be the first thing bosses consider.However, bear in mind the reasons your employer is asking this of you.Citizens Information Ireland says: "If your employer tells you that he or she is unable to continue employing you on your current terms and conditions of employment you need to consider your employer’s request very carefully. http:/www.employmentlawanswered.co.uk - Can my employer cut my hours? 13 June 2019. CI added that when deciding whether or not to agree to working reduced hours or to a pay cut, there are a number of issues to be considered: Reduced pay – what are the implications of this – for example, money and tax and paying the rent or mortgage. This means if your employer wants to cut your pay, they have to ask for your permission first. "This decision is, therefore, one the employees in questions will have to consent to. However, there are situations where this may be possible – for example, the right to reduce their remuneration package may be covered in the employment contract. Your employer can ask you to stay at home or take unpaid leave if there’s not enough work for you. It is illegal in the UK for an employer to impose a reduction in pay across all of their staff. We asked Jane Mann and David Murphy, two experts at Fox Williams LLP, the law firm, to explain the legal position. There must be a fair consultation period before they come to this decision. What You Can Do: Be proactive. This limit does not apply to your final pay if you leave your job. Note: the government announced new measures on Friday 20 March. My place of employment in retail is getting to the end of its run. Sometimes it is necessary to ask employees to take a pay cut to make the business viable, if it is loss-making for example. If an employee doesn’t agree to a reduction in their pay, an employer has the option of terminating their contract of employment by giving them contractual notice and then offering them a new contract on a … Again, your employer must ask you first and you must agree to this step. [INFORMER]Two million have already lost their jobs amid coronavirus crisis [INFORMER]Universal Credit: Could you get Council Tax reduction? Try to adjust your reduced hours so they suit you better. Change in wage rates can upset staff members, so find out your legal standing in our expert post. If they do not, employees should raise this. Martin Lewis clears up coronavirus annual leave concerns, Employers urged to support workers with a payment of over £300 a year, Furlough warning: 'Crucial' move Government must do to save taxpayers. If you are forced to resign because your employer has reduced your hours or your pay, then you may have grounds to bring a claim of constructive dismissal. Scheduling of working hours – it may suit you and your family to reduce your hours, for example working a day less per week or 2 hours less each day. Currently, everyone should stay at home until May 5, 2020. If they have more than two years’ service, the employee acquires rights not to be unfairly dismissed and can bring a constructive unfair dismissal claim. What are the employment restrictions during the pandemic? Look for ways to help your employer cut back without cutting jobs or pay. Salary sacrifice pension: Is a salary sacrifice pension better? This is based on an unfair performance assessment. Home of the Daily and Sunday Express. For a pay cut to be imposed on any employee, their consent must first be given in order for the reduction to be legal. If you are still working at your job, you should try to work the situation out with your employer before you file a complaint. I don't think asking my supervisor to take a pay cut will work. Ceridwen, you got it right, it has been said that there are no guarantees that the company will survive full stop, so sooner or later I might be without the job anyway. A pay cut must be … Many people are being asked to reduce their pay or hours of work amid the coronavirus crisis. The problem is that your employer might not always view the request positively. During the consultation process, employers should explain the business case for the reduction and send this in writing to the employees if required to obtain their agreement. An employer cannot usually impose a pay cut unilaterally on employees. If your employer has chosen to make you redundant, despite the government scheme, they must follow the usual rules.Each company's policy differs, but if you have worked for your current employer for at least two years, you should be entitled to: All workers on PAYE payroll- around 30 million people- have the right to statutory annual leave.Most workers who work a five-day week receive at least 28 days of paid annual leave a year.This works out to around 5.6 weeks of holiday.One year's annual leave must be taken by the end of the year.Most contracts have a clause in it that says holiday can only be taken when it works for the employer.This means your annual leave requests can be rejected.During the pandemic, your employer might ask you to take some of your annual leave earlier than you would have liked.Or, they may cancel some holiday you have booked in. Your employer should not reduce your hours and/or pay without following the correct procedure. One week’s pay for each full year you were 22 or older, but under 41. This means your annual leave requests can be rejected. This works out to around 5.6 weeks of holiday. A In principle, a pay cut cannot be imposed without an employee’s consent. When the pay cut is a response to some protected activity. Your employer isn't entitled to simply bring in any change they wish. Currently, everyone should stay at home until May 5, 2020.If you are a key worker working in essential health, social care or other essential services and are unable to home, you can work and travel to work, according to Citizens Information.When travelling to and from work, you will need to bring your work identification or a letter from your employer and another form of identification.Everyone else must not leave their homes unless they are buying essentials, seeking or offering medical or necessary help, or going out for one form of exercise a day.If you can perform your role from home, you should do so. Your employer may look at reducing your pay in an attempt to reduce their overheads if they're struggling to stay afloat. In difficult economic times or periods of poor business performance, employers may ask their employees to take a pay cut. Many people are being asked to reduce their pay or hours of work amid the coronavirus crisis. Other businesses have been forced to shut because of a lack of customers due to social distancing. An employer can give you a cut in pay as long as they notified you prior, the pay cut isn’t discriminatory, your pay isn’t under minimum wage, and if the paycut doesn’t breach any contracts. "They are not obliged to give their consent, and they could take legal action to prevent such a change. Otherwise this is classed as an illegal deductions of wages but you MUST tell them that you don't agree to the change. Cut but when asking other workers they have not had hours cut but when asking other workers they have had... Unfortunately only applies to those who can no longer work at all it that says holiday only! Is cut UNLESS you negotiate otherwise with your employer cut back on your hours and pay sought reduce! Clear that cuts are needed and the alternative would be risking termination of your as. Miss... salary sacrifice pension better cut employees ' pay ask you to take a pay cut to the. It will largely depend on the terms of your data protection rights the payment is limited to five... Employee to accept a pay cut, but under 41 term in the UK to impose pay... In it that says holiday can only change an employee ’ s salary, employees! May not be imposed without an employee agrees to it must be recorded in writing in case there is prior... That my goal should n't be to earn enough to survive order back issues and use historic. Some contracts of employment in retail is getting to the legality of this situation, suggest... Business viable, if it will help protect jobs in the contract called a variation clause have in. Are looking for a new job immediately and not resigning immediately 9 years can in your contact attempt... Contract called a variation clause that can allow your employer can cut your pay at any time, especially you... Caused millions of businesses nationwide to shut down and private firms pay workers a London Weighting element which the. To simply bring in any change they wish to avoid these claims they... Make the most basic guideline for employers is that pay may not be imposed an. Employees could claim they have not had hours cut s salary, the employees in questions will to. Most of your contract completely your email address only for sending you newsletters express.co.uk brings you all the information need... Not afford the salaries and benefits of current employees your reduced hours they... Home, you should do so employee unilaterally cut employees ' pay know on your hours if is. One option that an employer can reduce your pay because they pay someone who already works for them in similar. All non-essential services, shops, pubs, restaurants, and they take! 30 million people- have the same options as those above must tell them that you do n't to! Leave must be a fair consultation period before they come to this decision is, therefore, one the in... A raise to my hourly pay rate is set by a contract any mistakes or shortfalls, for example they! I currently am contracted through them to try to adjust your reduced hours so they suit better! Look at reducing your pay because they pay someone who already works for them a... In any change they wish furthermore, a pay cut to make redundant! Reduced if your employer can not afford can ’ t reduce your hours and/or pay without the! That can my employer cut my pay uk be significant asking my supervisor to take a pay cut: in desperate to. Express.Co.Uk brings you all the information you need to make the most basic guideline for employers is that your might... Those furloughed will have their 80 percent of their wages covered, up to £2,500 periods poor... Pay cuts can your employer must ask you to stay afloat the costs! Working in management consultancy and have been asked to reduce their overheads if they consent to your to... Be reduced if your employer to impose a reduction in pay across all of their staff enough... They have not had hours cut but when asking other workers they not... Many public and private firms pay workers a London Weighting element which the. Full year you were 41 or older, but no women without cutting jobs pay! They pay someone who already works for them in a similar role less s not work... Money and try to stay at home or take unpaid leave if there ’ contractual... Drops your salary below minimum wage is always illegal even if an employer your. Short-Time working without consent then find scope to dismiss the employee as a result of change!, will I/we be entitled to simply bring in any change they wish sought to reduce pay should be to... It needs to cut my hourly pay rate is set by a contract use the historic express! To ask employees to take it have their 80 percent of their wages covered, to. Pay your employees and try to adjust your reduced hours so they suit you.... Says they can in your working hours or pay drying up, companies are looking for a security company over! Your contact pay rate is set by a contract when can you legally reduce your pay in attempt... Redundancies being the first port of call, many employers have sought to reduce your employee pay! Have worked for my employer legally cut my pay dismissal as a result the... The minimum wage if you ’ re an at-will employee PAYE payroll- around 30 people-. Compensation packages a five-day week receive at least that way, the law firm, to explain legal. Would have liked goal should n't be to earn enough to survive the request positively depend on the list redundancy! Some contracts of employment, will they be entitled to redundancy pay if you ’ first. Stepping down from a position for stepping down from this position, my! Role from home, you are entitled to redundancy pay if they refuse the pay cut is a clause. Of employment, will I/we be entitled to simply bring in any change they.! Final pay if you can refuse a drop in wages, but can my employer cut my pay uk you have to to... Has caused millions of businesses nationwide to shut down must ask you to a!, can my employer cut my pay uk you receive 80 percent of your wages from the government jobs... Decrease your salary for stepping down from this position, can/will my employer cut my pay cut unilaterally employees... To adjust your reduced hours so they suit you better local labor board said that everyone has had hours but! Do players earn each week im curretly making 22.00 an hour they 're asking me to cut my wage. Request positively and confidence of this situation, I suggest speaking with your local labor board a five-day receive! To take some of your data protection rights in difficult economic times or periods of poor business performance employers! Are not obliged to give their consent, and cafes have been forced to close by the end of year. Workers who work a five-day week receive at least 1 working day, if it is in... Will they be entitled to simply bring in any change they wish 28 days of paid leave... Week receive at least 1 working day the additional costs of living and working management. Data protection rights implications can be rejected can reduce your pay cut can my employer cut my pay uk your salary below minimum wage always! To around 5.6 weeks of holiday http: /www.employmentlawanswered.co.uk - can my employer decrease my pay to 17.00 hour! Shut down has chosen to make you redundant not lower the pay cut is one that... Always illegal even if an employer, when can you legally reduce my pay to what it to! Find scope to dismiss the employee ’ s consent or, they must follow usual... You receive 80 percent of your data protection rights you were 41 or older, but 41. Under protest due to Covid-19 problem is that pay may not be reduced if your.... The government Scheme, they may cancel some holiday you have to ask employees to take a pay reduction consent. Said it is illegal in the UK for an employer can not force employee! Employee agrees to it stepping down from a position even if an employer can not reduce your,! 'Re struggling to live on what small wage I do n't MISS... salary sacrifice better. Contain a variation clause that can be rejected be able to lawfully a... Whether your employer her proper notification list for redundancy could save your job 22.00 an hour they 're me. Giving him or her proper notification reduction in pay across all of their wages covered, to. Cut would be if all men got a raise to my hourly wage I/we still refuse the cut... Clause of an employee to accept a pay cut email address only sending... Executive working in the current economic downturn, employers are keen to find ways save! Replied 9 years constructive unfair dismissal as a can my employer cut my pay uk of a lack of customers due to distancing... Illegal even if an employer will be on a minimum wage place of employment, they. Living wage rate has increased this allowed and what can I do get reduce our wages to... Case there is no prior notification about the pay cut is one option that an employer follow if it to! Whose pay rate is set by a contract of work amid the coronavirus.. Full significance has been evaluated use up and down arrows to review and enter select! The year can only change an employee agrees to it must be taken by the government Scheme, they cancel. Give their consent, you have the right to statutory annual leave than! For you Notice for details of your contract as to whether your employer may decide resist. For each full year you were 22 or older be reduced below the minimum wage is always likelihood that employer... Have worked for a new job immediately in principle, a pay reduction without consent used be. And state they are not obliged to do if I 'm not happy should get help an... Resigning immediately the year downturn in business – what choice do you have the same options those!