Ever since I entered the workforce as a kid, owners have been trying to find a way to pay people less.

I don’t mean cutting salaries. Paying people less looks like this:

  1. Paying less than minimum wage. I had this happen to me at an ice cream store. I was fourteen and wanted a job. The owner and I struck a deal. I was sixteen on paper but earned $2 less than minimum wage. It is not uncommon to negotiate these deals with young workers, undocumented workers, and people with felony convictions in the service sector who can’t find regular, professional work.
  2. Working people more than their documented time. How many of us have had hourly jobs and have been discouraged from claiming our overtime pay? From doctors offices to administrative assistants in corporate America, discouraging someone from claiming OT is a common practice.
  3. Pressuring people to come in early and stay late. When you are paid a salary, you are paid in smaller chunks. This confuses most workers. Sometimes your pay is expressed hourly. Sometimes weekly. Sometimes monthly. Look at your offer letter. So when your company pushes you to more hours/days/weeks/months than a traditional forty-hour work week, you technically receive a cut in pay.
  4. Stagnant wages. While some areas of the economy are improving, most workers haven’t seen the benefits of an improved economy. While the cost of living in America continues to rise, and you struggle to pay your student loan debt, your salary and 3.6% merit increase is worth less and less.
  5. Reduction in benefits. Your health and welfare benefits in America are part of your total compensation package. Healthcare costs are rising for many reasons, most of which have nothing to do with you. And benefits don’t start and stop with health. Anyone who survived the recession probably saw a reduction in PTO or “sick days” or retirement benefits. That’s money out of your pocket.

While HR is there to ensure that no illegal activities happen, your local HR team might not understand what’s going on in the trenches of the workplace. And, even if they do know, they might be unable to do anything because of the company’s culture. Or they might support it because more money for the company and its shareholders (whomever that might be) is what it’s all about.

So if you work for a company that is trying to cut your pay in obvious or subtle ways, get the heck out.

It never gets better.

Category: Work9 Comments

9 Comments

  1. Thank you for this post!

    I started with the company as hourly and few month ago became salaried along with the promotion and new boss. Ever since he keeps telling me it’s no longer 40-hour week for me, even though I get work done perfectly well within 40 hours. Could you please comment on what response I can come up with?

  2. Right on Laurie!
    Poor compensation is disrespect and today’s workers need to take it personally. Today’s HR needs to get the company to pay respectable compensation. If HR can’t stand up for workers, a union will.

  3. Unfortunately, most companies tend to take advantage of people who are not aware of the laws and desperately need a job. Though the HR department should be the link between the workforce and the management, there are situations when things do not work precisely like that. In the end, it is up to each of us to make sure that things are heading in the right direction and we, or the company does not take money out of our pockets.

  4. Good info Laurie! It’s hard to just get out though..one “subtle” way many companies initiated salary cuts is eliminating positions and the “survivors” getting to keep their job and also do the other jobs that the others were laid off from. (In 10 years I’ve survived 8 HR Re-orgs ) so I stay busy! 🙂

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