is my boss taking advantage of the pandemic?

by Alison Green on July 7, 2020

A reader writes:

I work for a small company (less than 25 staff). Like many companies, they slashed everyone’s salary by 30% at the beginning of this pandemic and laid off a few people. They’ve said that hopefully get things back to normal as soon as possible, and our pays would return to normal. A couple weeks into lockdown, during our company-wide weekly meeting, our owner mentioned they were working on getting a small business loan/financial assistance due to the pandemic. I’m not going to pretend I understand how they would get one or if they qualify, but we haven’t heard anything since.

Since then, it seems like our company is doing well, considering. We’ve been hired by new clients, we’ve been closing deals, and most of our clients have unpaused our services, so we’ve all been working 40 hours a week, if not more. We also hired back two of the people who were let go in the beginning of the lockdown, hired a new person for a new position, and are looking to hire three more people, including another new position. Also something gross the owner did — he mentioned to us how bad the job market is, that he usually only gets 30-60 serious inquiries for a certain position but he got over 100 this time. It felt like he was throwing in our face that it’s not much better for us out there.

Some other coworkers and I are starting to feel like our company is starting to take advantage of the situation, and not returning our pay to normal because we’re still as productive and working same hours but with a 30% salary cut. One wanted to ask about the loan during the weekly team huddle but got too scared. I’m also scared to say anything because I’ve only been at this company for less than a year. I’ve asked my direct manager how he feels, and he feels the same and has heard complaints for another person who reports to him about it. But I don’t really see him saying anything to the owner about it. He’s been with the company for a long time, and I don’t get the impression he’s stood up to the owner before.

What’s the best way to ask about our pay returning to normal? It still feels a little insensitive to ask about pay when it really doesn’t really feel like the world is “back to normal,” but our work doesn’t seem to be affected by it. Should we just ask about it individually to the owner? Write a collective letter (this option feels a bit forced, considering our “chill” work culture)? Or should we maybe accept we’re not working in the great progressive work culture we thought we were, and maybe it’s time to look around?

It really, really looks like your company is taking advantage of the pandemic.

A 30% pay cut is a massive cut. It’s no doubt causing enormous hardship. Some of your coworkers probably can’t pay their mortgage or rent right now.

Getting your pay back where it was, or at least close to it, should be a top priority for your company right now. And if you’re signing new clients, closing deals, resuming projects that had been on hold, and hiring for brand new positions, it looks pretty bad that your pay hasn’t moved back toward normal.

To be fair, you might not have all the facts. Maybe that new business is more than canceled out by other business that was lost. Maybe higher-ups know or have solid reason to fear more clients will be cutting back or dropping you altogether. Maybe the new positions are revenue-generating ones that are essential to helping the company recover. Maybe something else is up with the finances that explains why you’re still getting only 70% of your normal pay.

But if that’s the case, your company should be explaining that. The fact that they haven’t is a bad sign.

A company that genuinely cared about the hardship they’d caused and that was working hard to get salaries fixed as soon as possible wouldn’t stay silent on this front. They’d be proactively explaining what was going on — especially when those new hires were made.

But since they’re not communicating, you’ll need to ask. There’s nothing insensitive about asking for their latest thinking on when normal salaries will resume. And yes, by all means, do it as a group — the owner needs to see this isn’t one person being a pain, but a serious concern shared by a number of employees, and that you (plural you) don’t intend to just happily continue working at 70% pay long-term.

Exactly how to raise the concern depends on your culture and how communication usually happens, but do it in an actual conversation rather than a letter. That might mean raising it at a staff meeting or having a group of you request a meeting with the owner. Say it looks like the company’s work has picked back up and hiring has picked back up, and you’d like a timeline for returning pay to normal since the large cut you all took is a serious hardship.

If you don’t get the sense it’s a top priority for the company, then yes, there’s a problem — and that problem is that your company is happy to have you work at a fraction of your pay for as long as they can get away with it and happy to take advantage of your good will and flexibility during a crisis, and that means it’s time to look around.

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  1. Cheese_Toast*

    I have a few friends whose companies are being likewise crappy. I know my own brother just got together with the rest of his team to push back on the CEO of his company after months of reduced pay but increased workload; they got their salaries almost back to normal with a promise to re-address the issue in 6 weeks.

    But I wouldn’t take them too seriously when they tell you there’s no work out there. It seems like many states are opening back up, regardless of safety. Don’t let someone who might be actively working against you direct your personal interests. I would expect the possibility of some negative pushback as well. Good luck OP.

    1. Summer Anon*

      Agree. My company hasn’t missed a beat with hiring since this started but we are in an industry that is not really impacted. In fact we have been hiring like crazy and the new positions are starting from home. I trained about 10 people from home back in March after we were all sent home and just hired a large group.

    2. Koalafied*

      My parents’ company put the whole company on 80% hours/80% pay in the 08 recession and didn’t bring them back to full pay until 2015.

      1. Koalafied*

        *typo above, meant to write 2016. (The pay cut coincidentally happened right after the 08 election where the owner’s candidate lost, and coincidentally was lifted right after the 16 election.)

      2. pleaset AKA cheap rolls*

        Pay cut and cut hours is more reasonable than just a pay cut. Yes, it means it may be harder to make rent etc. But it’s not just “taking” from the staff. Having those cuts last that long is bizarre though.

        At the moment, I ‘d be very open to that sort of cut myself (recognizing I’m privileged enough to be able to pay bills on that kind of cut). I’d sure take it over layoffs – either for myself or others where I work.

        1. Pennalynn Lott*

          At my company, in order to minimize layoffs, everyone below Exectuvie level at my company was given a 6% pay cut. Executives (directors and above) got a 12% pay cut. The CEO and BOD took 50% pay cuts. They also stopped executive incentive bonuses, and paused all merit raises and promotions. This is supposed to last only through Dec 31.

          Our hours have not decreased. And, because we had two open positions but a hiring freeze was instituted, we’re actually all working more than our normal 40 to keep up. I like my job and my team, so it’s not a huge burden.

          Like you, though, I can pay my bills with the reduction in pay and wish that there was an equal reduction in hours/workload.

    3. Cj*

      Boy, do these comments make me grateful for my employer. We not only didn’t have a pay cut, we actually got bonuses in May of between $400 and $1600 depending on how many hours you worked in the prior 12 months.

  2. I'm A Little Teapot*

    A company that’s signing new clients tells me that whatever they’re providing is in demand. Which means other companies providing the same thing (item/service) might well also be hiring. Worth investigating.

    2. The Man, Becky Lynch*

      Possibly!

      But in times of a global economic turmoil it could be a temporary spike as well. It’ll depend on what they offer.

      This is a small company, which means they may have very limited resources as well and won’t necessarily keep them long term. New clients may just be using them as a filler until their other sources open back up to their former full capacity.

      I’m always game for always casting a line and keeping your eyes open! But this place also cut their costs by 30% and now can probably offer clients “sweet deals” because it’s a buyers market in that aspect. So without direct access to their ledgers…we seriously will never know their true financial health. Or what about the clients they lost or are hibernating now.

      1. animaniactoo*

        It’s also possible that they’re selling their services at a reduced rate to get business in the door and aren’t planning to sustain those prices.

    3. Night Owl*

      I’d also be curious to find out whether they’re hiring new people at the reduced salary. That might be very telling as to whether current employees can expect to get their previous salaries back.

  3. Anon Admin*

    I wonder if the new people were hired with the normal pay rate or at the reduced pay rate?

    1. irene adler*

      I would really wonder about them if they agreed to the reduced pay rate. Presumably they know the market rate for their position. So they’d be insulted to be offered 70% of that. Wonder if they are griping about this (though they may be too new to want to air grievances).

      There is always the chance someone was very hard up for a job. Which means the employer took unfair advantage. Not a good look for any employer.

      1. Colette*

        Market rates change. It’s possible that there are no jobs available at the market rate of 6 months ago.

        After the high tech bubble burst, people being laid off from my company were told to expect a 30% pay cut because the market rate had changed.

    2. EPLawyer*

      I’m thinking they got hired at REALLY BELOW market value. Because after all, you should just be grateful you have a job at this time. If the boss mentioned they got 100 applicants, they KNOW they will find someone willing to take the job at any rate of pay.

    3. Hey Karma, Over Here*

      This is the time when salary transparency would benefit everyone. What is going on? Are they hiring on the cheap? Are they telling people that’s the salary, not the newly adjusted salary? What about when they do raise the long timers? What about if they don’t and the new people are making 30-40% more?
      This company sucks.

    4. Alex*

      That is exactly what I came here to say. I am a direct person so I might downright ask. Or if I really felt I couldn’t do that, I would at least make sure the new people knew that we were all working at 70% pay due to the company’s being in a financial emergency.

  4. WellRed*

    “Like many companies, they slashed everyone’s salary by 30%”

    I’m sure lots of people have had salary cuts, but 30%? Not cool.

    1. Annony*

      Yeah. Where I work, the executives had their pay cut by 25% but they did that to shield everyone else from pay cuts because they could afford it the most. I wouldn’t be able to pay my bills with a 30% pay cut without starting to deplete my savings.

      1. Paperdill*

        Exactly what my husband’s firm did.
        They also did what they could to allow the exec’s to continue working at the office, other wise a bunch of people under them would have been without work at all.

        1. Caroline Bowman*

          It’s a great shame more companies don’t take this approach, but rather penalise those who can least afford it in any respect.

          They deserve to be named and famed, I applaud them.

    2. The Man, Becky Lynch*

      I’ve seen it around 20% usually when folks around here are talking about theirs :(

      1. Mel_05*

        Yup. My company cut pay to 20% and laid off a chunk of people to bring back later. I’m currently working part time, but at my full hourly rate and everyone else just got brought back up to 100% too.

        There aren’t very many people who have been brought back even part time though, so things are still rough.

    3. Anon for this topic*

      We had our executives pay cut by up to 50% (with no reduction in hours) and most everyone elses pay reduced from 10-30% but with corresponding reduction in hours (and a blessing to go out and find side hustles if possible to make up the difference)

      1. Noncompeteguy*

        Be careful when you hear about executive paycuts.

        Executive pay is often 1/3 base, 1/3 equity and 1/3 bonus. Often when they say “50% paycut” they mean 50% base not 50% total compensation.

        1. The Man, Becky Lynch*

          Yes. This. Also 50% of a huge salary is still a huge salary. So it’s as somewhat relative as 10-30% of what the average folks are making in the long run.

          I always think “oh dear, one less ivory back scratcher” when the executives want to talk about their paycuts. They’ll recoup their losses when the profits start picking up, whereas the other staff is stuck there waiting for someone to say “Oh shit, so now we need to start giving the workers back the pay we cut back on…hm…maybe next quarter.”

          1. Zombeyonce*

            At my company people in a certain category that make over $100,000 got a 20% paycut across the board while everyone from $50-100,000 got a 10% paycut. The thing is, the president makes over a million so he’s still taking home over $800,000 even with the paycut. Even if he took a 50% paycut, that’s over half a million dollars. I feel like there should have been a different calculation for people with salaries over, say $300,000.

          2. Autumnheart*

            I understand that, but at my employer, they’ve already determined that nobody gets a bonus next year, and I can’t imagine Wall Street is going to be doing very well by the time next March rolls around. None of the executives are going to starve, for sure, but it’s still a meaningful gesture, considering how many employers are pulling a Ruth’s Chris, applying for loans that they award to themselves as bonuses while terminating staff.

        2. Yesplease*

          Our CEO messaged a lot that they were taking “100% salary cut”, not sure if he thinks we don’t realize about the equity/bonus.

    4. WellRed*

      For us, some people were laid off, all of us had to take a couple nonconsecutive furlough weeks and upper management took pay cuts of something like 7% to 12%. They really tried to spread it around.

      1. Lost ina Pandemic*

        I really wish my company would consider nonconsecutive furlough weeks, then at least we wouldn’t feel/look like we’re not a “team player” if we’re not all consistently working 40 hours.

        1. Helena1*

          Not legal where I live – if you are on furlough, it has to be for 3 weeks minimum.

          There is a government pay scheme though – if you are on furlough the government pays 80% of your salary, up to £30k ($50k). It’s a way of preventing mass lay-offs.

      1. EverybodyHasOne*

        I work in the corp office a chain of retail store – meaning all out stores were closes for weeks with no way to make any revenue. No pay cut for me. Would a cut have been justified? Yes. But the company decided not to do that to employees. OP’s company is doing this because they can and that says a lot of about where they work.

    6. Anon Anon*

      In my industry that has been horribly impacted by the pandemic, very few organizations have cut salaries, and almost none of them have cut salaries for employees making less than 75k.

    7. blackcat*

      Yeah, I lost my COL adjustment and my retirement match. I think that’s far more typical….

      1. Sola Lingua Bona Lingua Mortua Est*

        I’m bracing for that; we’re supposed to find out this month about the next twelve months–my company has been on a July-June cycle for about 5 years–and I’m expecting no COLA, no merit raises… just be thankful we’re all still here and working.

        Probably not the best timing for my first performance review since 2015.

        1. paxfelis*

          Does your name translate to “The only good language is a dead language,” or am I mistaken? Latin was long ago and far away.

          1. Sola Lingua Bona Lingua Mortua Est*

            It does. In some ways, Latin was and remains the first love of my life. I also enjoy absurd humor. It just seemed to fit when I decided it was time to go from just reading to reading and contributing.

            The language is not so far away. Mundus hic mundus Latinus est; sed meminisse non podest.

            Now back on topic lest I wander too far…

        2. Curmudgeon in California*

          My employer doesn’t give COLAs, and the “merit” raises only ever match national inflation, in an area where local inflation is about twice the national rate. This year, they announced that there would be NO raises. Furthermore, there will probably be layoffs in August.

          1. Sola Lingua Bona Lingua Mortua Est*

            That’s in the ballpark of what I expect to be told–privately, not a company-wide announcement where it might be more credible.

    8. wittyrepartee*

      I know someone who had a 30% cut, but they also cut his hours by 30% (he’s in healthcare).

      1. Anon Librarian*

        My son is in healthcare; they had a 25% paycut but not only did they restore it but they paid back the 25% for the 2 months or so that they had been cut!

    9. Lygeia*

      My workplace did a 30% pay cut until the PPP money came in. Now that we’ve spent that, it’s likely we’ll go back to that. It’s definitely Not Cool.

        1. Lygeia*

          Once we got the PPP money, our salaries were restored to full. Now that we’ve used all of it, we’ll likely go back done. I’m not well-versed enough in the ins and outs to know if it’s allowed or not. It doesn’t really matter to me, since I’m not part of making that decision. So the only thing that matters to me is that my salary is way below what it was.

          Needless to say, this among many other things has me searching for a new job. Sadly, I haven’t gotten anywhere. It’s a real depressing state of affairs :(

    10. AM*

      I (and some others) got furloughed from my company back in March – everyone else had to take a 40% pay cut.
      Nope, that’s not a typo.

      I would’ve been royally screwed either way.

    12. SDSmith82*

      We “lost” bonuses- but we were lucky enough to keep our salaries the same. We were all pretty ticked off that the company refused to pay us money we’ve earned (the bonuses are tied to performance and part of our pay packages) but donated a very large sum of money to various organizations- but that was also done for potential tax reasons-

      This company, well, sucks.

      1. The Engineer*

        I would wonder about the legality of cutting bonuses already earned. For cancelled sales, yes, no bonus if deal falls through. Going forward they could change bonus structure as well. Dumb thing is that stiffing sales staff will do more to drop sales than anything.

    13. Fake Old Converse Shoes (not in the US)*

      I know someone who works for an airline and had a 15% cut for February/March, 20% in April/May/June. There were rumours of a 25% cut but the union intervened.

    14. LCH*

      our company did do pay cuts but only for people who were making $75k and above on a sliding scale from 5-20% and the president had a 50% cut.
      30% across the board really screws lower earning workers and was not cool.

      1. Caroline Bowman*

        that’s another reasonably fair approach, the people who make the least being penalised the least / not at all and those on the bigger bucks, who can afford it most, taking the cut.

        It’s heartening to realise that some companies actually are fair-minded and do their best within reason to keep the ship afloat for everyone during tough times.

        1. Sacred Ground*

          Besides who can or can’t afford it, it’s the people at the top of the pay scale who have the authority make decisions for the company that the people at the lower end then carry out. They have to work with the consequences of management’s decisions but are not responsible for them. It only makes sense that the lower-paid workers not be penalized for things over which they have no control.

      2. BlueWolf*

        Ours was similar only the cuts started for people making $100k or more (law firm) and ranged from 5-50% (granted this is only based on base salary, so for lawyers I’m not sure exactly how it works out in the long run). However, even though my salary wasn’t cut, they aren’t doing raises and bonuses are 50% less than usual. I’m hoping they’ll make up for it by the end of the year if things go well. We are getting business in, but I’m sure clients are taking longer to pay or getting discounts.

    15. Greg*

      GM of a sales organization here. Sales CRATERED March 19th and I had to furlough half my team on a rolling basis starting in April (one week on/one week off). However, I covered the team members’ benefits and took a 95% pay cut. I don’t understand the mindset of some of these companies out there.

      Team is back to 100% though, which is awesome. We had a record June and July has started out like gangbusters.

  5. Bella*

    I thought this was my company for a second since there. But luckily they reinstated our pay at the end of the month.

    It’s always possible that they’re over-giving on good news to help pacify you during a stressful time – so that you don’t assume you’re getting laid off. It’s possible there’s an equal amount of bad news they’re just muting for now.

    But mostly this seems like something everyone should push back on, or at least seek a hard deadline of when it will be back to normal so you can make decisions accordingly.

    I’m also curious – are the people who were just hired working at reduced pay?

    1. Lost ina Pandemic*

      OP here – I was actually inspired to finally send in this question, because I saw someone on reddit make a post with this exact same situation. I hope this person sees this as well!

      As for the new hires, I’m pretty sure two of them is based off commission, but I don’t really know. When I was hired, I wasn’t allowed to negotiate my pay until after my 3 month review (and that actually went really well!) And guess what, I had that new pay for about a month, and now back to where I was when I started.

      So, I’m assuming the new hires would be in a similar situation, and maybe they said that hopefully by their 3 month mark, things will be back to normal.

  6. rudlchus*

    Ugh, I worked for a company that did something similar back during the dot-com bubble. We all readily took a pay cut and were grateful to keep our job, but were assured it was just temporary. I can’t remember if a specific time was given, I feel like that was the case. Anyway, the end date came & went & one of our senior folks asked about getting everyone’s pay adjusted & was either told outright or was able to figure out from the hemming & hawing that there was absolutely no plan to restore pay. I think the guy quit & took the company to court since he had it in writing that this was all temporary. He won.

    Anyway, there are definitely companies that take advantage of hard times. That capitalize on scared employees willingness to make sacrifices during a downturn in the economy & realize that those same employees are well aware of the unemployment rate & are too scared to speak up about broken promises or being treated unfairly.

    I have no good advice. Maybe some companies choose to do the right thing once they’re called out, but I’m guessing the owner’s mentioning of how many applications he received was a message to you all. Regardless, economies do turn around & companies that take advantage are always in a bad situation when that happens since they traded any loyalty by their employees for saving money right now.

  7. Lost ina Pandemic*

    OP here – Thank you for this response!! It feels good to know I’m not being crazy or seeming selfish to want our pay back to normal. I was really happy to join this company when I first signed on, but it seems like everything they’re doing since the pandemic begun are in bad taste, and this isn’t the only issue.

    Also yes, my coworkers are suffering as well. I’ve heard one coworker can’t complete her work on time, and is stressed with her two toddlers at home, because she can’t afford childcare anymore. Hearing that really broke me.

    1. The Man, Becky Lynch*

      If I could look you straight in the eye, I would.

      Wanting to be paid, the amount you accepted when you were hired or when you received your last raise, by the company you work for, is never selfish. You only want what you signed up for.

      Stress and chaos shows a real asshole for what they are. In good times it’s easy to be a good company, compassionate and fair but when things start slipping into chaos, then these people will throw you over board to save their ship.

        1. The Man, Becky Lynch*

          A lot of us do.

          We’re conditioned to be “loyal” and accept bad behavior from “superiors”, we think that our bosses are decent people [because who wants to work for an ogre?!] and that we’re all in this together. False, the power game is real and it’s in their favor to have us feel this meek and humble. But in return it’s our means to survival, we have to accept their treatment of us until we’re able to free ourselves because it’s just the circle of life of working to receive money that we in turn live a hopefully comfortable life.

          I’m glad you reached out and are feeling better.

      3. Alli525*

        Very much this. Very few of us work because we WANT to. Most of us work because we have bills to pay and because companies offer to pay us, in exchange for services rendered, sufficient money to cover those bills. Yes, these are extraordinary times, but returning non-executive-level staff to their full salaries should be top priority as soon as the company can turn a profit again.

        I work at a large nonprofit and our exec staff took significant pay cuts so they could afford to keep everyone at their same salary level (many employees were also furloughed, but in many cases the unemployment benefit covered much of the income discrepancy). I’m concerned that OP didn’t mention her boss having done something similar – it seems like the bare minimum of decency.

        1. The Man, Becky Lynch*

          My skin crawls when I hear owners say they “took a pay cut” in these situations because I’ve seen someone lie about that before. “I even took a paycut! The layoffs were the last resort!” [No he didn’t, no they weren’t.]

          But I’m in that special position to have my nose in the numbers. That guy was a total sad sack loser though, so I’m hoping that the OP’s boss is at least decent enough to have really taken the decrease with the staff.

        2. No Sleep Till Hippo*

          I’d argue not only the bare minimum of decency, but also more economical. I’m assuming here that the CEO does not work for less pay than non-executive staff. Even if the CEO is “only” making double what OP makes (a minuscule gap by today’s standards in most industries), that’s still double the savings if CEO takes the cut.

          Now granted, there are more OPs than CEOs… but still. It’s so weird how that rarely that pay gap comes up when companies are talking about the need to cut costs. Super weird.

          1. Curmudgeon in California*

            Correspondingly, employers seldom lay off middle to senior managers, even though they make as much as 2 ICs, but do actually less directly contributing work. The could sack a VP and keep 3 ICs, but no, they sack the ICs and then whine to those left that the work isn’t getting done.

    2. MeeMoo*

      maybe it would help to frame it as “I NEED this info to budget properly for [student loans, mortgage, car loan, etc]”?

      Like honestly 30% reduction is drastic enough that a lot of people would need to re-consider their spending, reduce their 401 contribution for a bit, whatever. It’s not like you’re asking about when the complimentary pretzels will be back.

      It shouldn’t feel uncomfortable to say “I deserve to get paid to what I agreed to as a wage,” but that is a way around it…

      1. Colette*

        Generally, what you get paid is not related to what your expenses are – that’s why you don’t get a raise when you buy a car. It’s reasonable to ask without excuses about why you need the money.

        1. Zombeyonce*

          However, it’s completely reasonable to base your expenses on what you’re already being paid, and I don’t consider saying you need to pay your bills that you took on based on a promised salary an excuse at all.

          Also, there are some cases where asking for a raise based on expenses is reasonable, like when you’re not being paid a living wage, but that’s usually better done as a group when possible.

        2. MeeMoo*

          I agree that you don’t NEED excuses, but some people are more comfortable with hedging than just saying this straight up, during COVID. It’s much more comfortable to frame it as a “need” issue than a “it would be nice to get more money” issue.

          And it’s not at all the same as a raise conversation, because logically we tie our expenses to our stated salary – which this is. It’s not “give me more money, because I want a fancier car”

          I get that it’s not their job to do your budgeting, but this is a different beast than raises.

      2. Curmudgeon in California*

        If I got hit with a 30% pay cut, I would be in a serious world of hurt. My mortgage doesn’t go down, and the utilities are always going up faster than my pay. I would not resign immediately, but my resume would be all over the place very quickly.

    3. pcake*

      I would consider that taking a medium-term cut of 10% would be loyal to the company if you feel the need, but that loyalty doesn’t seem to be going both ways. A 30% pay cut should be something a company that want to keep their employees would want to change so they can pay their bills.

      Maybe you could ask, while being very courteous, about this. And maybe it couldn’t hurt unless your industry is tiny to look at who is hiring and for how much.

  9. Snarkus Aurelius*

    I work in communications, and I frequently advise TPTB about how things look. Sure different things are paid from different pots of money. The average employee is smart and understands how budgets work.

    However, when you can’t give the receptionist a $5K increase because it’s “not in the budget,” but you ask her to process the Board of Directors annual meeting expenses and she sees the bar bill alone is $5K, she’s going to get upset. (True story.) Yes, she knows her salary doesn’t come from the BOD budget, but she also knows that money reflects TPTB’s priorities. And if there really isn’t money for her raise, is it a good idea to let a bunch of Fortune 500 execs drink to the tune of $5K in one night?

    Similarly, employees can see that the business is getting new business, signing clients, working regular hours, etc. Therefore it’s reasonable for them to wonder why their pay isn’t returning to what it was before. When it comes to pay, I always advise 100% transparency.

    That’s why you need to follow AAM’s advice and pay careful attention to the response you get. If it’s anything less than a yes, then TPTB better have the most amazing justification.

    1. Nonprofit Nancy*

      To me, it’s the new hires that are in bad taste. You have funds available for new workers but not your existing staff? I feel a good company would try their damnedest to spread out their work among existing employees, using the savings to restore their salaries … (unless there’s some really niche specific skillset they desperately need to hire for to get back on track? Which they would have to explain really carefully). Onboarding a new employee is expensive and if you’re at the level of cutting salaries without cutting hours, you should be in a hiring freeze. Also if you’re cutting salaries you should really be cutting HOURS too – at least give people their time back.

    2. Granger*

      Snark, I’m wondering if this is true: “The average employee is smart and understands how budgets work.” I feel like a lot of people I work with know what they feel they “deserve”, but have no idea about the connection between the revenue and our job security / paychecks (e.g. you can’t just look at that large gross income line). Maybe it’s an industry thing? Or career vs. job employees / mindsets?

      1. doreen*

        I’m really not sure the average employee is that smart. My husband is a salesman for a hardware distributor who gets paid a pretty decent salary. He had his pay cut 25% – which was actually pretty good because the sales dropped to almost nothing in March. At some point they were paid the 25% retroactively but the cut wasn’t reversed. The salespeople ( who you would think would understand the connection between sales,revenue and pay) were outraged and talking about quitting and going to work for a competitor – but the competitor paid straight commissions. Which means no sales, no money. but somehow that was better than a 25% cut in pay and a 50% or more cut in hours (because they were no longer going to see their customers)

      2. Snarkus Aurelius*

        What I meant was that most employees know there isn’t a giant pile of money that goes in and out. Each division or project gets a budget allocation. There’s a strategy behind budgeting, which is really the heart of the matter.

      3. Mid*

        I mean, a lot of jobs don’t really have a direct connection to revenue, but that doesn’t mean they’re not worth their salary. I’m a paralegal (which is billable) but I’m also the office admin, so over half my time is spent not bringing in money. However, my work allows the office to run smoothly so the big revenue sources, the lawyers, can do their work.

  10. Sasha “Potato Girl” Blause*

    I’d start looking for a new job. IME working at a small business, if you say anything about pay being too small/not on time, it will not go well for you. Judgmental remarks about not living within your means, maybe even a a mandatory all-staff lunch and learn with a financial advisor if you complain. Remarks about how the company doesn’t want people who are only there for a paycheck. If you’re unhappy with your pay at a small business, especially one that wants you to experience and/or perform certain emotions and thoughts, you just have to move on to get more pay.

    1. Toads, Beetles, Bats*

      All-staff lunch-and-learn with a financial advisor as retaliation for asking about a raise?? That is some next-level nonsense right there.

    2. The Man, Becky Lynch*

      Again, for the people in the back. This is not a “small business” thing, I understand this has happened to you, so I won’t say that nobody has ever went to this extreme or been bothered by people wanting their checks on time, however it’s NOT the norm. Tons of large businesses abuse their employees, lose paychecks, screw up on payroll and shrug it off and seriously are intensely unethical.

      This is a DYING business problem or epicaly bad management problem, not a small business problem.

        1. Seeking Second Childhood*

          Nah. Secretary of State…you don’t have to play political games. No need to kissinger anyone’s seating arrangement. :)

      2. Keymaster of Gozer*

        I worked for one of the largest firms in the UK and got stiffed on my pay a few times (they blamed it on IT errors. I worked in IT and knew that was total rubbish) so I agree it’s not a small business only issue.

    3. I'm A Little Teapot*

      For a real life example of a big company being crappy, take a look a AON, at least in the US/Chicago. They did a 20% pay cut, yadda yadda. Now, they’re walking it back. And they’ve taken a massive hit reputationally. There’s a lot of really good people who don’t want to work for them in future.

      It’s not the size of the business. It’s the character of the management.

    4. Zombeyonce*

      Remarks about how the company doesn’t want people who are only there for a paycheck.

      I love this one. Of course I’m only there for a paycheck! Do they think I would show up if they didn’t pay me? No, I would go find another job. Would they continue to work there if they stopped getting a paycheck? I don’t think so.

  11. employment lawyah*

    Can you finish the sentence “you should pay us more because ____” without making it about what you want, but entirely focusing on the benefit to them? If so, do it! If not, research more. Try to avoid words like “deserve” or “fair.”

    I say that because they’re… acting like a business. With a glut of unemployment they are opting to keep salaries low. Presumably if there was low unemployment and they had to pay more, they would do so. And yes, they may be jerks, but most folks are selfish jerks when it comes to money. (Nobody gives money away, whether it’s an employee or investor or owner.)

    So it isn’t often the role of a company to figure out how to pay employees more of their profits. Rather, they only do that if they have to or if they can demonstrate that there is a real net benefit.

    Often there is! But demonstrating that is probably your job. It requires a blunt self-assessment: In this market, how much are you worth and how easily could you be replaced? Some industries are really sensitive to employee skill and knowledge, especially ones where there are long term projects or really specific company expertise. Others are not. (It can be really hard to replace a litigator in the middle of a case, for example. But it’s surprisingly easy to replace a real estate closing attorney with another one, so they are much more fungible.)

    If you think you have negotiating power (individually or in a group) you should figure out how to use it. If you don’t have negotiating power you can resort to a simple ask, or a morality-based need/fairness argument, but those are much less likely to work. Otherwise you may simply need to move on.

    1. MCMonkeyBean*

      Being able to provide concrete reasons is good when asking for a raise, but I don’t think it should be necessary to get your regular salary! You and the company already came to an agreement on what the job was worth when you first accepted the offer, it’s not reasonable to ask people to make that argument again.

      1. Lost ina Pandemic*

        lol ok yes, thank you. I was reading this comment like “Pretty sure I’ve already established my worth”

    2. aebhel*

      ‘Most people are selfish jerks when it comes to money’ is the kind of thing that rich people tell themselves and each other so they don’t have to feel bad about being selfish jerks and mistreating their employees. It’s not really borne out by the evidence if you look at any group other than rich people.

    3. D3*

      They are “operating like a business” and “most people are selfish jerks about money” in no way makes this okay. NOT IN ANY SMALL WAY.
      They had an agreed on salary with employees. You can’t just roll back a freaking THIRD of that and then act like that’s normal and acceptable. It’s not. Not in any way, shape or form.
      This is the rich owners making the lower class bear the brunt of it while making themselves richer. Do not try and excuse that.

    4. xristiana*

      this doesn’t really make sense. they already proved they were worth their prior salaries when they first got hired/earned raises/etc. they shouldn’t have to negotiate a 2nd time. their performance, experience, knowledge, and skillsets haven’t decreased by 30%.

    5. consultinerd*

      Many people and companies may be selfish jerks when it comes to money, but people also don’t forget when they perceive they’ve been taken advantage of. At the moment, many workers are suddenly worth less and easier to replace, but that will not always be so. If my employer cut my pay by 30% tomorrow while bringing in a raft of new work, I might not jump ship in the current job market but I sure as hell would start looking and get set to land at a better employer when things stabilize.

      From the business standpoint, they should be thinking not just about workers outside options and replaceability right now (low and high, respectively) but also about whether they care about retaining high performers and being able to recruit new ones post-crisis.

    6. employment lawyah*

      I am not saying this is good, friendly, etc. I am not “excusing” it. I am merely giving advice about how to make the strongest argument. IMO, things have changed significantly for various parties and some negotiations will, in the end, reflect that reality.

      If you were an at-will epidemiologist, you now get to say “sure I agreed to $100k but you need to pay me $150k now, or I’ll go find someone who will.” If you were an at-will office functionary who can be easily replaced by anyone else working remotely, your value may have dropped significantly and you may not get as much money: They are going to ask “who else can I get for that same salary you are demanding, and are they better?”

      Negotiating without paying attention to that reality seems less likely to work, so whether or not you “believe” that people are worth the same as they were in different, prior, circumstances (does that also apply to the epidemiologist?) you should consider it.

      1. Frankie*

        Hmm…I feel like this is a very literal, textbook take on what “at-will” means. In reality, employer-employee relationship is just that, a relationship, and the quality of relationship translates into productivity and quality of work. A 30% pay cut is enormous and a huge blow to morale. Sure, the employer is saving some money, but at the cost of employee goodwill, and risking the turnover of accumulated knowledge and the added expense of having to hire a lot of new people (who, not being paid what they were worth 6 months ago, won’t be very motivated to perform well). That will, in turn, be felt by the clients. There are a lot of consequences to focusing on maximizing profit at the expense of nearly everything else.

  12. Carrie Oakie*

    OP, I have been there (minus the during a pandemic bit.) My old job had furlough days already unstated to save costs when I came on board. Just over a year later they informed “everyone” (we don’t think everyone was actually asked/told) that we’d need to take a 10% pay cut. The majority understood & agreed, because they said it was temporary & we’d have a monthly meeting to go over how we’re trying to get back to a better position. We had those meetings the first three months, after that no meetings. Some people had new cars. Others were moving into a “smaller” (but still over 1 mil) homes. Slowly the pay cuts came to end years later and only for those who asked directly. It was ridiculous. Stay on top of it, and don’t feel like you have no options. I have never had a job where they didn’t try to remind us “there’s not much out there/paying what you want” – there is, and frankly, if a company is willing to negotiate & offer me benefits/perks that equal the dollar amount, they’d get me.

  13. MedGal*

    In a decent company, we took a 20% cut in salary AND hours. No working the same hours for less. It was set for 90 days at the outset with re-evaluation based on the business. Business is back to normal. In two weeks (the 90 day mark), we are back to full pay and hours. That’s how it should work.

    1. Nonprofit Nancy*

      This. I know of companies that had to do paycuts but at the very least they also reduced hours. For people paying for childcare especially this can be a godsend. Others (sadly) used the extra time off to get paid sidegigs as delivery drivers etc. Time truly is money. I’m skeptical the company has enough business that they need everybody working 40-plus hours a week, but not enough money to pay the workers what they used to make.

    2. Mpls*

      +1 – It’s possible MedGal and I work at the same place, b/c that’s exactly what my employer did. And made sure we had access to whatever state gov’t resources were available for to close that salary gap (involved the company making an application to multiple state unemployment agencies where they had a presence).

    3. Saberise*

      That is how my employer did it. 15% cut in hours which meant 15% cut in my paycheck since I’m hourly not salary. Than within a day someone quit so that changed to 10%. It’s really the best way to do it. None of this working 40 hours for years before they “find the money” to bring you back to full pay. Still WFH but I already told my boss when we go back I want to only go in 4 days, not worth the long commute and dealing with parking for 4 hours.

    2. RobotWithHumanHair*

      Interesting that the over $150,000 companies’ names are on that list, but the under $150,000 (by state) aren’t. Some kind of legal thing with that? I didn’t see my company (or their parent companies) on the larger $$ list; they could theoretically be on the other one, but there’s no way for me to verify.

      1. The Man, Becky Lynch*

        If you click your state in the under 150,000, it’ll come up with a zip file to download with the info.

        1. Lost ina Pandemic*

          So I googled it for my state and found a list, but didn’t see my company on there.

        2. blaise zamboni*

          I did that, and the under 150k spreadsheet only has the city, state, amount, and some basic anonymous info (loan amount, business type, gender/veteran/racial status of the owner?, date approved, lender) but no info about the actual name of the company.

          Still interesting data to have! But the >150k spreadsheet is no-holds-barred. I’ve been snooping on that for my area. Thank you, Adversary, for providing this link.

      2. The Man, Becky Lynch*

        It’s not a legal thing, it’s just a tracking/priority thing. Treasury department is interested in the bigger loans but the SBA has all the details for everyone who had one administered. That’s why it takes you to the SBA database for the smaller ones.

      3. Susana*

        My employer is on that list, claiming that they saved 15 jobs when I know for a fact that everyone got laid off except 3 people in the US office and 4 people working remotely in another country.

        Does anyone know, is there any kind of reporting or accountability mechanism here?

    3. Mouse*

      There are plenty of reasons why they didn’t use it for salaries. Those loans were also able to be used for rent, plus I think utilities and some interest, and still be eligible for forgiveness. The loans were able to be used for *anything* if the company doesn’t prioritize forgiveness. If it’s a choice between restoring full pay and keeping the doors open, I can understand a business opting to use the funds to keep the doors open.

      Additionally, the loans wouldn’t cover all compensation anyway.

      Not justifying this particular company, just wanted to push back on the idea that loan funds should automatically go to restoring pay. If the company closes, the employees’ pay is reduced by 100%.

  15. Exhausted Trope*

    I hardly know what to say. This makes me physically feel ill.
    OP, it’s too too crappy you have to deal with a huge pay cut on top of the Crisis stress.
    I just don’t understand why some companies are so eager to take advantage of the situation like this.
    I do like Alison’s solution. The owner needs to understand that this is not sitting well with staff and that yes, they do have other options.
    Good luck to you!

  16. Geek*

    I’ve had a pay cut at one company, and that was a few years ago.

    One of our major customers experienced a problem and stopped ordering supplies from us for a while.

    The company chopped everybody’s pay by 10%, unless doing so would put someone under a “livable wage,” in which case that was their new rate.

    In every monthly company meeting, they showed us the numbers. How we were doing. What was going on. The goal was for the company to make $0 that year. As long as the company didn’t lose money, we could stay in business indefinitely.

    At the end of the year, the company ended up making a profit, so our salaries were restored, raises were issued, and the profits were distributed proportionately to your pay cut. I think my annual cut ended up being 2-3%.

    I would be hard pressed to stick around a company that wasn’t as transparent, especially if they have resumed hiring.

    1. Lost ina Pandemic*

      Dang, these comments have really proven to me that our 30% cut is not the norm.

      1. Anonymouse*

        My job is in an industry that has…largely been unaffected by the pandemic. We’re in software so the vast majority could work from home full time-we transitioned mid-March and the office has been closed since. I think there are some security and physical facilities people who are still in the office but that is pretty much it.

        My company’s yearly raises follow the tax year, not calendar year, so I was wondering if they would halt the April 1 raises/yearly COL adjustments–they didn’t.

        I’ve had plenty of beefs with my company in the past–they don’t pay competitively for the area I am in, they acknowledged a gender wage gap three years ago and then haven’t followed up since, they play the game of “what salary are you expecting” when hiring instead of being up front and honest in listing expected wages in ads, but all that said–I have been frankly very impressed with their handling of things during the pandemic.

        I don’t exactly know what industry you are in and I can’t tell if you are working from home or in the office, but it sounds like the business is doing just fine and continued salary cuts that steep are…suspicious at the very least.

      2. juliebulie*

        It’s not the norm, and it’s very short-sighted of management to believe that this won’t matter if another opportunity should happen to cross your path.

    2. D3*

      A+ way of handling it right there. That’s the kind of transparency employees expected to take a cut deserve.

  17. learnedthehardway*

    One thing I would look at before concluding that the company is taking advantage is whether they have slashed prices / rates for their products / services. I know that in my industry, some companies have had to do this. So while they may have business, they aren’t charging clients as much, and so aren’t making the same margins.

    Your sales team may have some insight here, if you or your manager have contacts on that side of the business.

    If the company is busy, hiring, and prices / revenues are the same, then they are taking advantage of employees. But if they’re busy because they’ve slashed prices in order to maintain sales volumes, then it may be a different story.

    1. learnedthehardway*

      ETA – also, keep in mind that if the company got loans, they do need to be repaid. The management may need that loan money to keep the business afloat in the short term, but they also have to think about how they are going to repay the loan over the next couple of years, which they will have to do whether the economy improves significantly or not.

      1. Lost ina Pandemic*

        As for the loan, I’m pretty sure he said they were applying for PPP. And if that is the case, pretty sure they can only get it if they haven’t laid anyone off, and 75% has to go to employees. I do wonder maybe they didn’t get it because of the lay offs, and not everyone was hired back.

        1. msjwhittz*

          It’s my understanding the loan only converts to a grant (as in, doesn’t need to be paid back) if those criteria are met. If the company is expecting to pay it back as a loan, they are not beholden to those rules.

    2. beanie gee*

      If that’s the case, the company owes it to its employees to be transparent about why they are hiring/busy and NOT reinstating their original salaries. They need to communicate with their employees about the company’s plans to get people back to their original salaries.

  18. Doodle*

    Same thing is going on at my company. If you happen to be in Texas, TWC has a program that is supposed to supplement employees income if hours are reduced. I found out about it a couple days ago and brought it up to my company. I’m hoping we can at least get that. It just really sucks because it’s super uncomfortable to bring up the issue. It’s hard to tell right now whether they don’t really have the money or are taking advantage of the situation

  19. Gazebo Slayer*

    I’m sorry, OP. It really sucks to learn ypur “progressive” employer is screwing you over.

    There’s a certain kind of company that loves to tout how “progressive” or “cool” it is, but just uses all that talk as a way to lull people into a sense of security. I once worked for a very casual, friendly place where the owner was always nattering about what a ~nice guy~ he was and how he was “making a living, not a killing.” Turns out he paid below minimum wage, if you ever managed to convince him to hand over your paycheck at all.

    I suspect there’s a certain amount of tautological thinking with people like that. They tell themselves “Well, I’m a ~nice~ and ~progressive~ person, and I’m the ~little guy~. Therefore, by definition nothing I do can be exploitative, because I’m one of the good ones.”

    3. juliebulie*

      One of the surest signs of a phony is someone who continually tells you how nice, honest, unselfish, etc. they are. If they have to tell you, then they really aren’t.

      1. Gazebo Slayer*

        +1000

        Possibly the worst is someone who tells you “I’m a friendly guy.” Here, “friendly” actually means “creepy.”

      2. Night Owl*

        Same with the ones who brag about how “politically incorrect“ they are. I run from those people.

        1. Gazebo Slayer*

          Oh, those ones are at least being honest. Honest about being assholes, though.

  20. RCB*

    It was likely a PPP loan they applied for, and probably received, and the SBA released information yesterday on all of the recipients of those loans, so you should be able to see if your company got a PPP loan. If the loan was for less than $150,000 then the company name won’t be listed, so it’s hard to track, but anything $150,000 or over will be listed by company name in the data the SBA released.

  21. ThisColumnMakesMeGratefulForMyBoss*

    Regardless of any other crappy thing your company did, the FIRST thing they should have done BEFORE hiring anyone* is to bring your pay back to what it was before the 30% cut.

    *including those who were laid off. You’re picking up the slack and working 40+ hours a week to make up for those that were let go, so the first priority should be to give you the pay were receiving prior to the pandemic.

  22. HeyPony*

    I would suggest you change the narrative you are telling yourself that “most companies” responded by cutting salaries by 30%. Some did, “most” did not.

  23. Remote HealthWorker*

    Everyone. Please believe and listen to your employers when they are telling you they suck.

    Any employer saying “things are much worse out there” or “we cut less then others” without providing you data to back it up is fearmongering to their benefit.

    My company did the same thing. Then a lot of staff found new jobs. Suddenly benefits and raises are back on the table.

  24. Granger*

    OP, in Alison’s response she pondered, “Maybe the new positions are revenue-generating ones that are essential to helping the company recover.” and that really jumped out to me. What kind of positions are the new ones? Because if they are generating revenue that’s probably a whole different thing when it comes to the timing of the regular pay resuming (than if the new positions are support / non-revenue generating). The whole thing stinks though! I feel for you!

    1. Lost ina Pandemic*

      It’s hard to say which positions generate more revenue than the other. We are all a part of closing deals, so it’s hard to gauge it that way. I do understand that my company would be more focused on spending their money on certain areas than others, and my role can seem as non-essential as others, but I do feel they value my work. One of the new positions is a JR level of an existing position, and I know they need more help on that end. And honestly the other new created position feels like a response to the pandemic and all of us working remotely. It’s a Project Management position, which does sound helpful to have someone act as a liaison between depts to make sure all our goals are being met and streamlined effectively, but it doesn’t feel very necessary to me right now.

  25. OhBehave*

    It really sounds like the owner is blowing smoke up your pants. He’s thrilled to get the same quantity of work for the low price of a 30% pay cut. Push back while at the same time you look for a job.

  27. Nacho*

    My company didn’t cut our pay, but they did “strengthen” one of our benefits. Previously if we or our family/friends used our own website to make purchases, we could be refunded 25% of what was spent, up to 1000 EUR/year by providing the purchase #. Now we’re only refunded if the purchases are made on our account linked to our company email address. If we want the money for family/friends, we have to buy their stuff for them.

  28. willow for now*

    LW, I am seriously sorry about your situation. But the evil Willow is thinking that with a 30% pay cut, the men are now making what the women have been making all along. (Statistically speaking, of course.)

  29. Ben*

    They probably feel justified because, even if business has picked up, there’s still a lot of uncertainty and they want to retain the flexibility. It’s prudent business management! (They tell themselves.)

    Of course this is totally messed up. Unless they want to make you all equity partners in the business, then bearing that risk is what THEY signed up for — as is paying you what they agreed to pay you.

  30. Bob*

    Its likely your boss is taking advantage of the pandemic. Of course you cant prove it without the financial statements, which is what they are counting on.

  31. Sacrificial Pharmacy Tech*

    The cuts are hitting healthcare too. My sister’s hospital has decided they’re going to get rid of rotational pay for nurses (meaning if you work flow or charge instead of just on the floor, you get extra money on top of your base pay), which for my sister means losing over $7k a year. And they just sprung it on them out of nowhere. To quote my sister, “We didn’t get hazard pay and then I GOT COVID and now this!”

    My company just laid off a ton of pharmacists and I’m worried they’re going to do what the other retail chains did and start cutting techs too. During a pandemic. When we’re busier than ever because we have been one of the few things allowed to be open. And with flu shot season only a month away, which means double the workload. And with continuing to cut the budget to the point that we’re working with the absolute minimum amount of staff who are already doing double the workload. A pharmacist said, “They’re going to keep cutting the budget until the cost of paying out lawsuits is more than the cost of the budget” and I 100% believe that.

    1. Lost ina Pandemic*

      :( That’s so upsetting. I hope y’all are able to find better things soon, or hopefully ppl will get their s$@& together and do the right thing!!!

  32. Anonycat*

    Mine is a 40 percent time and pay cut. We try to stick to the three-day work week, but it’s impossible to get everything done — and there’s more work since everything now is virtual. The cuts are not across the board — some have received only 10 or 20 percent cuts. The company has been transparent, however, and we all know that several large revenue events for us have been canceled or postponed this year. We have been assured that we will be back to full pay as soon as it’s feasible. I’m hoping it’s soon — this is the fourth month — but my state is not doing well on the reopening.

  33. Ugh...*

    I almost thought someone at the company I worked for wrote the initial question. I’m in the exact same boat; same cut amount; company is hiring (and not all are revenue generating), and company promotes how cool and generous they are with employees. It’s been tough. I was already expecting to not get my typical bonus, but to lose that AND take a 30% pay cut means I could be out almost half of the pay I was eligible for at the start of the year with no recourse. They were really transparent at first and now not so much and no one wants to be the one to bring it up.

    C’est la vie

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