How To Cut Wages

Table of contents:

How To Cut Wages
How To Cut Wages

Video: How To Cut Wages

Video: How To Cut Wages
Video: Reducing Wages | Cutting Employees Pay | Employment Rights Ireland 2024, May
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One of the factors affecting the cost is the level of staff salaries. This is a very important indicator that practically all heads of enterprises pay special attention to. Therefore, the issue of reducing wages is relevant for many managers. How to reduce labor costs?

How to cut wages
How to cut wages

Instructions

Step 1

Fire some of the staff. To do this, analyze the number of personnel, labor productivity of employees, the compliance of the staffing table with the needs of the enterprise. If, as a result, it turns out that part of the staff needs to be retrained, and some must be dismissed, take into account the fact that when an employee is laid off on the initiative of the employer, the latter must pay the person who has been laid off, not only severance pay, compensation for unused vacation, but also payment average earnings for two (and in some cases - for three) months. In addition, notify the employee of the layoff at least two months before dismissal. Fire employees for systematic violation of the work schedule, for drunkenness, truancy, for inconsistency with the position. But at the same time, keep in mind that the facts of violation of discipline must be recorded by acts, memos, orders of collection. Facts of non-compliance with the position held should also be recorded with the help of orders to recover for untimely or poorly performed work, for non-performance of official duties, for negligence towards them.

Step 2

Reduce the pay of those categories of persons whose salaries do not correspond to the return on the overall result - the same candidates for dismissal, before the fact of their dismissal. In addition, pay persons with partial workload for the actual hours worked or for the actual work performed. When might a need to cut wages arise?

- upon restructuring of an enterprise and / or change of ownership;

- when revising the level of cost to increase the competitiveness of products and services;

- when the level of production falls;

- when introducing new technologies and reconstruction of production, etc.

Step 3

Transfer workers from a time-based pay system to a piece-rate system. This method, however, can lead to an increase in nominal wage costs. But such growth should be accompanied by a decrease in production costs due to an increase in labor productivity. If this did not happen, then you have set unreasonably high piece rates. Approve the transition from one pay system to another by the Workforce Council and the trade union.

Step 4

Reduce the salary: the level of salaries and tariff rates. In this case, do not forget to notify employees about this at least two months in advance. Please note that the employee has the right to disagree with the new working conditions. Then, on the basis of this, you have the right to terminate the employment contract with such an employee early.

Step 5

Reduce the working time of the enterprise, release employees on unpaid leave. At the same time, be sure to receive an application from the employees with a request for such leave. If an employee refuses to go on unpaid leave, and his workshop / department does not work by the decision of the administration or for other reasons, then you are obliged to pay such an employee the forced downtime at the rate of two-thirds of his salary specified in the labor contract.

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