Can my employer reduce my wages without reducing my hours worked?

A question about : Can my employer reduce my wages without reducing my hours worked?

Hello everyone, newbie poster here. Hope someone can help or direct me to any useful links regarding my question. Looked but can't find direct answer.
To give you a quick overview of my situation. I work in a very small company, there are two of us in my department. All the staff has been informed today that because times are hard (aren't they anywhere), they have no other option but to cut our wages by 20%. It has been hinted that it is non-negotionable, as if we don't accept they may have to let people go.
I have worked out that 20% of my wages equals to losing one days pay a week. I don't think it is fair to expect us to work same amount of hours for the less pay, so I was going to propose to work a four-day week. Do you think that is reasonable request, as I've been told that they can demand that we work same amount of hours for reduced pay. Also I am full time on the hourly pay as opposed to set monthly wage, does that make a difference?
Thanks, Lee316.

Best answers:

• do you have a contract. Personally i think it is outrageous. Your idea of working a 4 day week was a far fairer and
  better idea. I would suggest you
  a. Still make your proposal (you said it was only hinted that it was non negotiable) and see what they say, (do you have a union)
  b. look at your contract.
  c.. ring ACAS or have a look on their web site.
• Yes I do have a contract, and no union. Contract is just one page consisting of job acceptance, holiday entitlement and how much notice of termination of employment I have to give. Nothing else, no small print, no rules or regulations, nothing.
• An employer can do what they want. They call your bluff as to whether you take them to an employment tribunal.
• My work place is in the same situation (estate agency) we've all had to cut our hours back from full time to 9-4 each day. It was either that or some people would have lost their jobs. Some of the people at my work are still working their normal hours but just getting paid for the new hours but no way would I do that, my wage is rubbish enough as it is. I would try to talk to your boss and let him know your thoughts and maybe any other ideas you have for making cut backs.
• I agree with Incisor.
  Fortunately - I'm not in that type of job - but am wondering what I would do in those circumstances. I guess my personal reaction would be to say to the employer - "I'm not going to do that - my pay will stay as is - otherwise I will resign and have you for constructive dismissal". Hopefully that would deal with the matter and things would stay the same - if they didn't, then I would indeed resign and bring a case for constructive dismissal (sending my employer a letter by recorded delivery saying words to the effect "I deem you to have sacked me because of......(the paycut). You have given me no option but to consider myself dismissed by you."
  I would keep a copy of this letter - to prove to the D.W.P. that I had been sacked, rather than resigning - to try to ensure that I would suffer no benefit sanction for having resigned (as you wouldnt have done so voluntarily).
  Different peoples circumstances differ - you might be in a position where you could claim extra Tax Credit if they cut your wage and therefore wouldn't suffer as much of a drop in income as I would. You mightn't have any "back-up" of any description to cover you if the D.W.P. turn funny and don't believe that you didn't "resign". Without knowing your personal circumstances - all any of us can do is state what we personally would do in regards to your job.
  One thing I would be quite sure and certain of is that less pay would equal appropriately less hours worked. They can't have it both ways. Either there is less work or there isn't - if there IS less work - then you work less hours (for that lower pay). Don't let them get away with a cut in your hourly rate whatever you do.
  Personally - I would never believe the "if you don't have a paycut - some people will lose their jobs". I would regard that as a blackmail and refuse. At a very pragmatic level - when an employer says something like that I interpret it as "This is our last ditch attempt to keep going - by cutting the wagebill. Actually though - we don't really think this is going to work either - it will just buy us a month or two of time - and then the firm goes under anyway." Errrr....just realised that means I'm saying I don't rate the chances of keeping the job anyways......errrr.....well...that is true I'm afraid.
  Hope things work out for you.
• Hi
  It depends on whether you want to keep your job I guess.
  I run a consultancy and just been into help an employer of a textile factory. The business basically wanted to put everyone on minumum wage, that was the only way to stay in business.
  Those that accepted it just did.
  Those that didn't want to accept it where put "at risk" and then the new jobs where created. Those that didn't accept it where given preferential interviews *(basically, the "job is yours if you want it"), then the factory opened up the positions externally through the job agency and filled them.
  Bozo
• Thanks everyone for your replies. Still don't know what is the best thing to do. Our company hasn't got HR department.
  Bozo, as I understand it from your post, are you telling me that they can make me redundant and then fill my position straight away with somebody on a minimum wage? (After my pay cut I will be on a minimum wage myself.)
  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. However it couldn't have come at the worst time. Nobody employes month before xmas, and xmas aside, I cannot afford to be even a week without a job (in debt till the eyeballs, another thing I'm working on to solve). Also, we are still very busy, this is the busiest time of the year for our company, which makes it harder to understand how they could be struggling.
• I always understood that the law does not allow an employer to fill a position until 2 years after the person who had that position was made redundant. If one gets rid of employees on the normal wage - to take on NMW people in those same positions - then I would have thought that was illegal. Worth checking - and I certainly would if I was one of those workers.
  O.P. - sorry to hear how bad the timing is on this. Well - there's 2 other Boards on this Forum you need to visit then:
  - the Debt Free Wannabee Board (for help and advice dealing with those debts)
  - the Old Style Board (for advice on keeping the housekeeping budget as low as possible - and boy don't some people on it "know their onions" on that front).
  Good luck.
• Just an idea but will the paycut and hours you work take you below the minimum wage?
  If so you've GOT THEM
• Both of us in my department do exactly the same job, I can't think of any way they could rename the position. Just been through my contract,it describes vaguely the job but there is not a mention of job title, so think if they want to rename the position I could argue that it could be the name of my position as I haven't got any? Also as the other person is only a couple of years away from retirement age and I am considerably younger, and the job is very physical, could I argue that it would make more sense to keep me?
  The only difference is that that other person has been there two decades and i've only notched four.
• It's a tricky situation and one to tread carefully in.
  Personally I'd accept the 20% pay cut on the condition that you only work a 4 day week.
  If the company is having financial troubles, and no one accepts a pay cut, then chances are that some of you could be made redundant.
  It's a tough time for everyone at the moment.
• You've probably got a case for unfair dismissal but I'd try and negotiate your hours down instead.
• Thanks everyone. Well had the meeting today, stated my case, and my proposal of four day week has been turned down flat. I don't want to go down the redundancy route as I can't afford it. No guarantees either way, I honestly think they are just clutching straws now. Time to look for another job, but in the current climate what are my chances realistically of getting anything.
• As long as your contract states your salary and normal working week (as it should) they cannot force you to take the pay cut.....as you have to agree to a variation of contract. There only option in those circs is to make you redundant which they can legally do as your original job ie the one that exists now with your salary and hours and will change if only by the salary. It is a very grey area in law and TBH if that happened I reckon that you would have a very strong case at an employment tribunal but often small companies don't take advice or expect their employees to take it that far IYSWIM.
  The only reason to let them make you redundant is for the 4 weeks salary you would receive tax free and instant access to the benefits system or any insurance you may have. It also takes away any awkward questions that may be asked at interviews in the future as to why/how you left your last job....but whether that is the right thing for you is another matter?
  Talk to ACAS, they are very helpful and are happy to explain everything in laymans terms....
  Good Luck