Asked to agree to a pay cut

Should I negotiate contract terms...

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I'm a qualified accountant currently employed in industry as a finance manager. My employer is asking all staff to agree to a 30% pay cut due to a Covid-19 related downturn. It will reduce my salary to £29,000, with no endpoint specified.

Would it be reasonable of me, in return for agreeing to it, to ask for my notice period to be reduced from 3 months to 1 month? I can temporarily live with the cut, but am not happy at a prolonged spell of being paid significantly below sector rates. 

Replies (14)

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By Sarah Z
24th Jul 2020 00:55

I think at this point everything is up for negotiation, what have you got to lose?

There are so many people looking for jobs at the moment, I guess you will need to decide if it's a deal breaker if they say no. But definitely, no harm in putting it on the table.

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Psycho
By Wilson Philips
24th Jul 2020 07:15

I assume that your hours are also being reduced by 30%?

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By tom123
24th Jul 2020 07:55

I feel your pain. We (management team) agreed 20% at the start of furlough - no change in hours.

Of course, at that time we (all) assumed furlough was until May.

Bit gutting, of course, that furlough then carried on.

Bit like the queen mother and the blitz, we can at least look the affected staff in the face.

What is the end point of this reduction?

£29k seems very low to me for qualified staff though.

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Replying to tom123:
Quack
By Constantly Confused
24th Jul 2020 09:43

Quote:

£29k seems very low to me for qualified staff though.

I was qualified for a good decade (and a second professional qualification) before I got £29k...

But then I'm the first to agree I'm rubbish :)

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Replying to Constantly Confused:
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By tom123
24th Jul 2020 10:54

I never seem to be able to get to the 'average' salary that CIMA seems to quote for it's members - I think they are saying £70k these days..

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By paul.benny
24th Jul 2020 08:29

Be careful what you ask for on notice period - reducing on your side is fine. But may be less fine if it means the employer can dismiss you with reduced notice (= potentially smaller payment, less time while still employed to get a new job).

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Replying to paul.benny:
paddle steamer
By DJKL
24th Jul 2020 09:06

The obvious thing with that is to suggest making non symmetrical adjustments re notice periods (employee can say give 1 month employer still needs to give 3 months)

In addition, in exchange for the 30% salary reduction in the short term that the OP is foregoing, might he/she agree that if there is within x time period an event of redundancy then there is some formula which augments any termination sum with the salary he/she is currently being asked to forgo, possibly on a reduced sliding scale after the salary is reinstated to the full amount, and that during the reduced pay period any redundancy will be calculated using the original full salary.

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By Justin Bryant
24th Jul 2020 08:57

As a wise old friend once told me, it all depends on whether you need them more than they need you.

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By Wycher
24th Jul 2020 10:51

The other area to look at would be asking for additional holiday, as a pay off against lower salary. I presume the reason for reduced salary is reduced work so hard to see how they could object.

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Replying to Wycher:
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By tom123
24th Jul 2020 11:00

Fairly sure they want the same work for less money..

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Slim
By Slim
24th Jul 2020 11:14

I would agree but start looking for a job ASAP and probably break my notice period when I get a job.

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By ohwhatnow
24th Jul 2020 11:41

we've had a similar situation here. about 65% of our staff were furloughed in March. The remaining staff, mostly finance (me) and project managers remained on 80% as it was put to all that everyone's salary would now be equal. I would've liked to see in the written change to the working staff agreements that there should at least be scheduled date (s) for a review of the reduced salaries - when, hopefully/if, work improves some are concerned that there will be a distinct lag to revert the salaries.
i also picked up on the fact that furloughed staff now get any worked days (flexible furlough) and holiday pay at 100% of normal salary- where they are entitled to a topup above the furlough rate. Whereas the working staff remain on reduced pay - not a particularly fair system.

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Replying to ohwhatnow:
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By the_drookit_dug
24th Jul 2020 11:50

We have exactly the same situation. Although there has been a discussion as to whether the hours worked by staff brought back from furlough can be paid at 80% of their pre-furlough rates if they agree to a contract variation...

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Scooby
By gainsborough
24th Jul 2020 12:41

I'd be quite wary of looking for a new job at the moment - lots of accountants being made redundant - a few of my friends joined the list this week.

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