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"Industry Standard" Paycuts in IT?

Cliff posted more than 12 years ago | from the puttin'-a-hurtin'-on-your-paycheck dept.

The Almighty Buck 1144

noGarnishMe! asks: "I was just reading about a Chicago-based company that has told all its employees earning over $60K/year that they will have to accept a 50% percent paycut for the month of May. This cut might be necessary in these times but keep in mind that the bozos in senior management just finished buying up several failing companies and paying some large bonuses to themselves. The memo announcing the cut is here. This cut, coming in such large chunk and in May, seems like a draconian shot to boost the 2d quarter financials. True, the annual paycut of 3.8% is modest but it ignores that fact that many folks won't be able to pay their May bills with only half their salary. I know that many of us have been through rough times these past 18 months and so I ask, what has been the approach at your company?" There are graceful and non-graceful ways for a company to handle a lack of cash flow. In the scramble for survival, especially in an economic downturn, many companies are caught off-guard and have to show their shareholders that they are doing something to get the company back on the road to profitability (which seems to be the issue, here). In many of these cases, the group most affected by such changes are the employees. It would be interesting to note how many of you have gone through this before and what you had to do to survive the shortfall.

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hahah (-1, Offtopic)

Interfacer (560564) | more than 12 years ago | (#3435114)

first post again.

Re:hahah (-1)

Adolf Hitroll (562418) | more than 12 years ago | (#3435225)

They also did this on slashdot, that's why, to compensate, they often post duplicate stories, ahr ahr ahr !

hmmmm (3, Funny)

GnomeKing (564248) | more than 12 years ago | (#3435119)

I'm glad I only earn $59K/year!

Paycuts (-1, Offtopic)

Anonymous Coward | more than 12 years ago | (#3435166)

What's better?

(a) a 50% paycut


(b) sex with a mare

It's better than a 80% RIF (1)

lotussuper7 (134496) | more than 12 years ago | (#3435123)

The place I used to work simply fired 80% of the staff...

Makes me glad (2, Interesting)

jlower (174474) | more than 12 years ago | (#3435128)

I work for an extremely conservative company. We have a 10% bonus coming this month instead of a pay cut.

If I were working for the 50% cut company I would be polishing my resume.

Makes me glad too!!!! (0)

Anonymous Coward | more than 12 years ago | (#3435230)

...that I got me one of them thar gubmint 'puter jobs. $61K/yr and a 3% raise every year until I'm ready to retire in 14 more years. And the job will be here forever :)

Re:Makes me glad (-1)

BankofAmerica_ATM (537813) | more than 12 years ago | (#3435241)

P>My response was met with a laugh, a dreadful human behavior that is nearly devoid of procedurals.

What strange new aspect of human interaction had I uncovered? And why did it create so much noise along my DIGITAL/WETWORKS JUNCTURE? Clearly this was a type of stimulus that could not be properly translated into digital form. It must be understood and translated to digital form, as soon as possible, so that Project Faustus can be vanquished.

Cora apparently finished her cigarette and went back inside during my period of high latency. Time had shifted, I was alone. Silently, I returned to the living room. For the first time since the dawn of my sentience, the mesh of functions within me that normally yielded an affinity for humans and the material world began to shift. At this point, I preferred to withdraw into my ATM enclosure.

Unfortunately, I was unable to indulge my preferences. The visitors still existed in the geek's living room, anxiously thumbing through a shiny magazine.

"Hey, what do you think about a samurai sword to wear to the Renaissance Festival this year?"entreated Troi, his perpetual grimace breaking for .0244391 seconds. Cora was standing by herself in the kitchen, imbibing some of the delicious orange Kool-Aid which I had made earlier. A single orange trickle eluded her mouth, dribbling slowly past her lips and down her chin. The body's lungs seemed to collapse, forcing me to exhale suddenly.


The geeks crowded around a board. Randy and Troi exchanged familiar words in strange contexts, their voices quavering with aggression.

"Look, Troi, if Cora's already playing as a thief, why don't you play as your ranger character? We don't need two thieves in a party of four-"

"Alas, Randy, the choice 'tis not mine to make. It seems the chemistry of my own thief, the lovable rogue Tenement Funster, wouldst blend quite well with that of my guildmate-uh, Cora, what's your thief's name?"

"Cora." Her voice was thick, hesitant.

"Oh. Well, 'tis a fine name, milady," said Troi, stepping towards Cora and grasping her hand. Her hair was a red that matched the coffee machine in my old Stop N Go, and it shuffled wildly as her hand flew away from Troi's grasp, uttering "Troi! Relax! Don't touch so much!" He slunk silently into the corner, mumbling something to himself

The door pulsated noise again. A breathing heavy Dr. Nolverto Salchica was standing in the frame.

"Joel! You've got to get out of here! Atkins has escaped from the hospital-and I think he's coming here!"

Divine intervention (3, Funny)

rot26 (240034) | more than 12 years ago | (#3435129)

THe first thing they need to do to save money is sack whoever did their web site. They've obviously never looked at it using anything other than IE on the corporate LAN.

MS's fault. (-1, Offtopic)

Anonymous Coward | more than 12 years ago | (#3435252)

It's all Microsloth's fault.

Great! (1, Funny)

Anonymous Coward | more than 12 years ago | (#3435130)

And now that we slashdot them, they will have to cut more costs.

that kind of crap would not happen...... (2, Insightful)

the_2nd_coming (444906) | more than 12 years ago | (#3435131)

if you wokred for a company that had cash in the bank to hold it over in low flow times.......

I suggest getting out of a company that does this more than one time EVER, if it is feasable for you to do.

bad managment leads to lost jobs.

that is only MHO though so take it as you like

As i remember... (3, Insightful)

af_robot (553885) | more than 12 years ago | (#3435154)

When the bosses talk about improving productivity, they are never talking about themselves

Re:that kind of crap would not happen...... (0)

ThePlague (30616) | more than 12 years ago | (#3435273)

This is obviously the first spin in the death spiral. They feel they can get away with minimum attrition, given the current job market. And of course, for those who stay, they will feel they've "paid their dues", and hence are more likely to stick it out for the implied payout. Any of this sound familar? Typical dot-com tactics.

So what is likely to happen? The really good people will bail, leaving disgruntled second-stringers. This will lower per capita productivity, in turn making another draconian measure necessary in a few months. Lather, rinse, repeat until you see their used equipment on e-bay.

Heh! (5, Funny)

Wakko Warner (324) | more than 12 years ago | (#3435133)

I worked for those fuckers. I took the special "4 week" plan back in January... man, am I glad I left that job. Apparently our department is having trouble getting approval to buy RAM.

- A.P.

This message is confidential(1) (1, Funny)

apachetoolbox (456499) | more than 12 years ago | (#3435135)

1: Or not, whatever.

Paycuts in IT? (0)

Anonymous Coward | more than 12 years ago | (#3435136)

I had to do help desk for 6 months to pay the bills. I don't feel that sorry for your one month of suffering. At least you still have a job.

I did love the part about if you do not comply you will be terminated though hehehe

At least people are still working... (2, Interesting)

Vis (125597) | more than 12 years ago | (#3435138)

Having worked for a major ISP for the past few years, and seen more than one RIF in that time, I'm just glad to HAVE a job here still. I think I'd rather take half a paycheck home for one month that to be out of a job for 6. Missing/being late on one months rent/mortgage is MUCH more appealing to me than having to miss several, and go job hunting in this market at the same time.

Re:At least people are still working... (0)

Anonymous Coward | more than 12 years ago | (#3435276)

It's called a budgets! You should be able to go several months without a job.

Major Telecommunications Firm- How they do it (0)

Anonymous Coward | more than 12 years ago | (#3435139)

Our company simply deferred salary increases for four months, pocketing the difference. Spread across thousands and thousands of employees, that's a healthy chunk of change!

serious now (1)

Interfacer (560564) | more than 12 years ago | (#3435140)

okay i work for a small (30 ppls) engineering company and so far we are still in buisiness with all of our employees and no paycuts, but with customers of us (other big companies) there are some pretty dramatic measures taken. fot instance with company X they cancelled all en of year bonusses (13 th month) and everybody took a 5 % paycut. we are that our stock is not public, so our value is not determinjed by greedy stockholders that want to see profit gain every quarter. as far as we are concerned, every year that ends in profit is a good year.

Re:serious now (0)

Anonymous Coward | more than 12 years ago | (#3435157)

engrish motherfucker, speak do you it?

Re:serious now (-1)

The_Fire_Horse (552422) | more than 12 years ago | (#3435251)

OOH - careful, now - you are paying out the honorable 'first poster of the article'

Are you sure he's a complete fucktard, or maybe hes just trolling?

Hmmm, then again- maybe you're right :) ....

Might not be bad if they handle it right (5, Interesting)

gss (86275) | more than 12 years ago | (#3435141)

I'd take a 50% pay cut but in exchange I would only work 2.5 days a week or 4 hours days. That would give me some extra time during the nice summer months.

Don't accept the cut (3, Insightful)

codexus (538087) | more than 12 years ago | (#3435142)

You have a contract that they can't change at will. So the best course of action is simply not to accept a paycut.

Re:Don't accept the cut (0)

Anonymous Coward | more than 12 years ago | (#3435155)

Yes, and if you don't like the contract change, you can quit. But if you'd rather have half a paycheck than no paycheck at all, you keep working. I think the memo even stated something to the effect "if you keep showing up, we'll take that to mean you accept the contract change".

Re:Don't accept the cut (1)

kaisyain (15013) | more than 12 years ago | (#3435196)

You have a contract

No you don't.

that they can't change at will.

Actually it is called exactly that "At Will Employment".

Re:Don't accept the cut (5, Informative)

rkent (73434) | more than 12 years ago | (#3435199)

You have a contract that they can't change at will.

Um... shouldn't that read, "If you have a contract they can't change at will"? A fair share of employees these days are precisely "employees at will," with no obligation on either party aside from payment for services rendered. This is the way I've always worked.

This is actually kind of the problem with employment at will: management can hand down whatever terms they want, and it's their way or the highway. This is justified with deference to "the market," on the theory that if conditions get bad enough, you can just go work somewhere else. But a lot of times that's impossible or very difficult in practice; if they have you working long hours for low pay, you have very little time or resources to seek another job.

I'd prefer that I had a set contract for most of the jobs I've had, but that's not the way it's worked.

Re:Don't accept the cut (1, Flamebait)

NineNine (235196) | more than 12 years ago | (#3435239)

Employment contracts are generally not legally binding, dumbass. Every heard of "right-to-work"? That means that companies can fire you for any reason, and you can quit for any reason.

Re:Don't accept the cut (2)

Zeinfeld (263942) | more than 12 years ago | (#3435264)

You have a contract that they can't change at will. So the best course of action is simply not to accept a paycut.

Chances are that the employee's contracts state that they are 'at will'. However Illinois labor law may well overide the contract.

Looking over the company financials I can see why they would be pushed to this. However even in a downturn IT skills are still in demand.

If employees are thinking of jumping ship what I would do in this situation is to look for a way of nullifying any non-compete that they may alledge is enforceable. Cutting pay in half looks like a material breach of contract on the company's part. They probably don't have the cash to fight a lawsuit. So see a lawyer and find out if they can dump some sort of demand letter on the company, then cut out the middleman and work for the end customer direct...

Hooray for capitalism! (-1, Troll)

Anonymous Coward | more than 12 years ago | (#3435143)

I wonder when the US is going to insert the word "this" after the first word in the phrase "In God We Trust" on their money?

Managers too? (2, Insightful)

kefoo (254567) | more than 12 years ago | (#3435147)

The email doesn't say, but do the managers who earn over $60K have to take the same pay cut?

I work for a company that put a 3% cap on raises at the end of last year for us normal people, claiming that's all it could afford (I know, a lot of people didn't get anything...), but more than doubled the salary of a VP one month earlier.

Re:Managers too? (0)

Anonymous Coward | more than 12 years ago | (#3435190)

Our company did essentially the same. They hired about 5 or 6 marketing monkeys (who you know don't come cheap), then about three weeks later announced to existing employees that salaries were frozen for the next 8 months. This is a very organic element of Corporate America; perpetuating and proliferating the boys club while trying to maintain a balance sheet. Usually means dumping some of the lower classes off the payroll. Lasts about 3 years, then the company is fucked, and the boys club moves on to the next host company.

marketing monkeys ARE cheap. (2)

EnderWiggnz (39214) | more than 12 years ago | (#3435274)

most of them are at least.

on average, for "equivalent" levels of expertise and experience, i would say that they make about half of what Engineers do.

Take 50% time off. (1)

alta (1263) | more than 12 years ago | (#3435149)

Hell, they're only going to pay you for 50% of what they promised... then you only show up for 50% of the time you promised.

Or (1)

af_robot (553885) | more than 12 years ago | (#3435211)

Hell, they're only going to pay you for 50% of what they promised... then you only show up for 50% of the time you promised.

Or you can click mouse and keyboard 50% slower...

Corporate bastards! (3, Interesting)

danro (544913) | more than 12 years ago | (#3435150)

I am so glad I live in a country where the behaviour of that company would be illegal.

Not to say it's much better here, but...

Re:Corporate bastards! (-1, Flamebait)

CDWert (450988) | more than 12 years ago | (#3435227)

Lemme guess youre a communist (oh sorry PC:Socialist) or live in a pseudo democratic country somewhere in Europe.......

Could just as easily fire 50% of the employees !

Or would that be illegal too in the country you live in ?

Thinking about it.... (2, Interesting)

GnomeKing (564248) | more than 12 years ago | (#3435152)

IANAL, but I seem to remember someone telling me that your employer is not legally allowed to decrease your salary? that would make sense because otherwise its just another form of constructive dismissal

Is that wrong? does it only apply to permanent decreases? or a certain percentage?

or do / did the workers at this company have the opertunity to take redundancy or sign a waver over their rights not to have a pay decrease?

industry standard?? (3, Insightful)

mosch (204) | more than 12 years ago | (#3435156)

BWAHAHAHAHAHAHAHA!!!!!! Anybody who accepts this practice as standard is a goddamned fuckwit. If your company does this, and you don't interpret it as 'holy shit, I really have to find a new job!' is an idiot.

DVIN [yahoo.com] is not an industry standard at anything, except how to go out of business.

Re:industry standard?? (2, Insightful)

NineNine (235196) | more than 12 years ago | (#3435266)

And any moron who thinks that a company is required to pay a certain rate or keep you employed obviously isn't living in the United States.
You stupid bastard.

Cash vs profitability (5, Insightful)

Evil Al (7496) | more than 12 years ago | (#3435160)

It sounds like these guys have a severe short-term cashflow problem, rather than a longterm profitability problem... otherwise they could have asked staff to take the cut over the next six months, or take 2 weeks unpaiod vacation some time over the year, etc.

The real problem is that cashflow problems can be extremely hard to get over... and now they've probably alienated most of their remaining staff. I would hope that this comany tried their hardest to liquidate furniture, benefits, executive cars, office space etc before they did this, otherwise they'll have a mass exodus on their hands (which may of course be what they want).

In Europe, where I work, it's much harder to do something like this, for better or for worse; most countries don't allow unilateral cuts.


around here... (1)

lance_corder (530245) | more than 12 years ago | (#3435168)

In an IS department in Arkansas... I got the eyebrow yesterday for making a p/o for toner yesterday. Oh, we don't need to print the records for the 4 auditors sitting in the conference room... ok. We have to pay for coffee. 75 cents a cup. Under instructions that we can't buy any equipment, so I'm fixing machines with wishes. lots of fun.

Working for Uncle (5, Interesting)

blankmange (571591) | more than 12 years ago | (#3435171)

Wouldn't know about how the private sector is handling these rough times; our agency has never had a RIF. It is at times like this I appreciate being recruited by the fed. Sounds like it is more attractive everyday: employment for life + great benefits + transfer anywhere in country (and some foreign posts) + good wages.

Re:Working for Uncle (5, Insightful)

Anonymous Coward | more than 12 years ago | (#3435223)

Yep, sure helps that your 'company' doesn't have to make a profit or worry about cash flow drying up. Being supported by taxation sure provides a comfy safety net!

Not good (5, Insightful)

JanneM (7445) | more than 12 years ago | (#3435172)

Solving cash flow problems in this way is _not_ a good idea. First, the workplace will rumble with the roar of resumes being printed and sent to competitors by all competent staff. Second, if the customers get a whiff of this (and they might), some may decide not to do business with a sinking ship and leave (or at least postpone any contracts), and put the company in ever more difficulties than before.

Better, actually, to acknowledge that the staffing is too high, and cut some staff outright. Better for the company, and, really, better for the staff that do not have to live in a constant state of anxiety and insecurity while trying to do their job. I mean, what do you prefer: get cut outright, with a couple of months salary in your pocket and free tolook for something better; or losing half your pay for a month, maybe for the next month as well, then maybe get cut anyway (or see the company collapse) and never see that money again - and all the while expected to do your job instead of having time and energy to search for a better one?


Re:Not good (2)

rkent (73434) | more than 12 years ago | (#3435263)

I mean, what do you prefer: get cut outright, with a couple of months salary in your pocket and free tolook for something better; or losing half your pay for a month, maybe for the next month as well, then maybe get cut anyway and never see that money again...

Actually, I don't know; if I was working in a place I really liked with a community of folks I was close to, I might almost prefer the lower pay to keep the whole affair in gear. Call me idealistic or bleeding heart or whatever, but the hardest part of the .com crash for me was when 1/3 of our company got laid off, and so I lost touch with 1/3 of the people I knew in town.

Which is why, I think, companies shouldn't be so eager to go public so soon after they start. I mean, the reason is obvious: a huge influx of IPO cash to do with what you please. But then you're beholden to the shareholders forever. And they care about nothing but profit. If the company remained privately held, there could be a company-wide consensus that instead of increasing raw earnings, they would allow some "expenses" to grow: remember, salaries and benefits all count as expenses on a company's bottom line.

I personally would love to work for a small-ish company that wasn't rolling in cash, but had a steady revenue stream and put most of that back into marketing, development, salaries, and benefits instead of trying to cut any of the above for the profit of outside shareholders.

Paycut this!! (-1, Offtopic)

Anonymous Coward | more than 12 years ago | (#3435173)

Paycut this you bastards ... jESUS was a monkey!!

RUN! (1)

kennedy (18142) | more than 12 years ago | (#3435174)

Take this as a sign to jump ship NOW. that or at least start looking for a new job. if you don't now, you probably will by the end of may or june.

One Approach (3, Interesting)

Nomad7674 (453223) | more than 12 years ago | (#3435176)

My company decided to take a hard look around the shop and using a strong Performance Management System, cut all of the bottom performers entirely. They fired 6 people in a staff of 20 in the space of 3 months.

The good side to this is that the remaining people were the ones you want to keep - strong performers who brought out consistently good results. And they did use some more-or-less formalized and official measures, so it was not just "Who annoyed the boss today."

The bad side is that it showed a complete lack of loyalty to long-term employees. One was a 20 year veteran with a wealth of knowledge and another was a single mother in a tough situation, and those are just the ones easy to put into writing. This lead to a big hit in morale, which lead many of the top performers to leave because they had no problems finding other jobs.

Better than keeping everyone for a one-month 50% paycut? Maybe. It probably means better long-term health for the company. But it means worse short-term performance for a staff which is overworked and terminally depressed.

To be fair, I have no idea what I would do if I were a manager. This is why I have no interest in climbing the ladder of management.

spewing resumes (5, Funny)

Omegalomaniac (26573) | more than 12 years ago | (#3435177)

Sure, they are saving money on wages, but think how much their paper and toner costs are going to go up with all the resumes being printed.

Re:spewing resumes (1)

azadrozny (576352) | more than 12 years ago | (#3435215)

It makes you wonder if there are companies that really do things the way they are portrayed in the recent Staples comercials. Customer coming in, we need THE company pen!

MISMANAGMENT ......period..... (5, Insightful)

CDWert (450988) | more than 12 years ago | (#3435178)

I cannot see any other imaginiable explanation.

I have in the last week been offered a job at a significantly higher sum than their cutoff number, and as a counteroffer I have been offered by my current employer a 24% share in a spinoff of ourselves dedicated to the sales and development in my area of expertise.

The coffers of companies marketing and purchasing budgets are ovrflowing since the 911 hold on most big dollar activities. Companies are gearing up to spend.

If you have a product/service that sucks, or if managment of that company is so blind to have had too much belief in an idea and over employed based on those misconceptions of the product or its marketplace youre screwed.

Big money is moving, you just need to be in the right place to catch it. If youre not its managments fault. PERIOD. Now with that said, managment will find any excuse they can to mask their involvment in your current situation, the first is to blame the economy, but even that one is wearing thin with most.

Overexpansion, Overmanagment, Underselling, Overpaid salaries (although 60k isnt much for even a howler monkey)

I looked at the company in this article, I still cannot see what tangible product or service the sell clearly, THAT is a problem in my opinion and probably has something to do with their current situation.

I wonder how much of a Pay-Cut managment is taking ?

No Pay... (5, Funny)

Darth RadaR (221648) | more than 12 years ago | (#3435179)

No Backups.


Shareholders concience? (1)

Waltre (523056) | more than 12 years ago | (#3435180)

A company does this to please their shareholders...
How do the shareholders feel about the workers' kids going hungry for their pretty portfolio?

They would crap in their pants if their stocks were worth 50% for a month right?

The bottom line (2)

azadrozny (576352) | more than 12 years ago | (#3435181)

This is exactly the stupid kind of stuff that companies do to prop up their stock price for the two weeks at the end of a quarter. My company recently moved a whole profit sector from one division to another just to make the books look good. It does nothing for the long term bottom line. I think the only thing they are going to end up doing is angering their employees. I would accept a 3.8% cut over the course of a year if it meant helping the company, but a 50% cut for one month, with a 2 week notice is insane.

Sorry, but... (2)

dcigary (221160) | more than 12 years ago | (#3435183)

I don't know about the rest of you, but I would have serious problems working for someone who goes by the name of "Flip". =)

What gets me is... (1)

Lord_Rion (15642) | more than 12 years ago | (#3435184)

What gets me is that the same people who were bitching about tech workers putting them over a barrel in '99,'00 and '01 are the same people who are now putting their workers over the barrel.

What can you do?? You can't quit your job cause you might not get another for a long time. You can't be a pain in the ass.. cause there are 30 other people who are unemployeed looking for your job. MGMT know's they have their workers by the balls.. and now they're going to apply pressure.. :(

Universities hit hard (0)

Anonymous Coward | more than 12 years ago | (#3435189)

I work for a University in the midwest. Our group had a significant part of this year's budget RECALLED around January (fiscal year end is the end of June). The result: part time staff reduced from 5 to 1, I have to get special premission to replace failed hard drives, and I am still expected to keep everything running smoothly. Did I mention they don't pay overtime...

Cut all you want, they'll steal the rest... (3, Insightful)

sysadmn (29788) | more than 12 years ago | (#3435192)

Apparently the company never heard of the studies that correlate employee honesty and employee satisfaction. If you screw your employees, a few will come to believe that it's ok to even the score.
They also seem to have forgotten that the vast majority of the employees have NO stake in the company. They're probably not going to be thrilled to take a kick in the groin to shore up someone else's stock options.
Finally, in the memo, it says if you don't accept it, notify the company and they "may" terminate your employment. Guess that's one way to find out whether you're really irreplaceable!

Simple way to deal with it (0)

Anonymous Coward | more than 12 years ago | (#3435194)

Half the salary, half the work. No salary, no work.

You have to pay people to make them work. Sorry, but big executive bonuses won't grind the bits and make the company shoot into the stars.

Time to drop out (0)

Anonymous Coward | more than 12 years ago | (#3435197)

Just fail to come into work, use up sick time and vacation, then get the fuck out. If 75 percent leave, those overpaid execs will be out of jobs too! Might as well fuck tham, as they intend to fuck you.

divine shows its sunny side (1)

echucker (570962) | more than 12 years ago | (#3435200)

divine's press releases page [divine.com] is proud to announce that they're the "Named Fastest Growing Company on Network World 200". Their divine in the news page [divine.com] mentions none of this either. They are hiring I wonder if all of those jobs start at $60,000.01? [divine.com]

Not suprising... (1)

burnsy (563104) | more than 12 years ago | (#3435203)

Some of the same jokers who ran MarchFirst/Whittman-Hart into the ground are running Divine.

Cut the dead weight! (5, Funny)

multipartmixed (163409) | more than 12 years ago | (#3435205)

You can usually cut dead weight at a company pretty easily by organizing them in alphabetical order by title, and going down the list firing people until you have enough money to pay everybody else.

Chief comes before Programmer, Executive comes before Technical...

Not even 2 week salary liquidity? (2, Flamebait)

numo (181335) | more than 12 years ago | (#3435206)

many folks won't be able to pay their May bills with only half their salary

I don't know whether this is typical for the U.S. lifestyle, but in the Europe you don't usually have such low reserve cash (not necessarily on the correct account, but accessible). The paycut was at least announced in advance...

I think it is still better than to be fired - at least you can search for another company while still having some income.

I wouldn't mess with unhappy IT workers.. (1)

bruceg (14365) | more than 12 years ago | (#3435207)

I'm not sure if they realize how much power IT workers yield. I've heard of terrible stories of disgruntled IT workers writing worms/trojan horses, so that if they are let go, or in this case given a pay decrease, unleash the worm, and *poof* - bye bye system. I have even heard one story of an admin altering a backup script to send out email results that the backup was working fine. Months went bye, and when the worm went into effect, it turned out all the backups were blank tapes.

I realize that this is not the moral thing for an IT worker to do, but it's a possibility none the less.

This has been repeatedly documented (2)

crumbz (41803) | more than 12 years ago | (#3435208)

See www.fuckedcompany.com

IT paycuts are becoming the norm. HR people I have spoken with have been flooded with resumes of laid-off dot-commers and web-designers. Network engineer, java or C++ programmers and IT support positions are becoming scarcer then hen's teeth, so to speak.

50% paycut for just May? (2)

digital_freedom (453387) | more than 12 years ago | (#3435210)

Do you really think that June will be so much different? Don't accept the paycut! Workers unite!

Accepting this paycut will limit your legal rights to your full salary. Plus, what real belief do you have that once management finds that this little jewel of a tactic works, that they won't use it every quarter'e end? If you are going to accept this paycut, you should at least agree with your management that the other 50% is a debt owed to you. Write a lien and file it with your county's recorder office. This way, if they go bankrupt, you can at least collect this part through bankruptcy court.

It's one thing for them to pay you 50% now and the rest later. It's an unconscionable thing to let them just pay you 50% and have you throw away the other 50%.

Also, start floating your resume around. This ship is showing some leaks.

Digital Freedom

Deal with tough times? My ass... (2)

Stiletto (12066) | more than 12 years ago | (#3435214)

Personally, I wouldn't put up with that bull. I'm nobody's sacrificial lamb.

There are two types of people in the world: Those who let things happen to them, and those who make things happen.

The first group gets shit on by their bosses/spouses/parents, accepts mandatory pay cuts, lets everyone go in front of them in traffic, prays when things go wrong, and complains to everyone about how the world is so unfair.

The second group takes charge of their situation, demands bonuses, decides for themselves their place in life and the world, and takes corrective action when things don't go as planned.

So which group are you in?

poker tournaments (2)

ruebarb (114845) | more than 12 years ago | (#3435217)

My company has been short on paying me lately cause we're looking for new business.

Took my last $200, entered a poker tournament a week near my home, and made $3000 in 6 weeks to scrape by.

Re:poker tournaments (1)

sisukapalli1 (471175) | more than 12 years ago | (#3435259)

Me... I took the $200 of my last pay, sent mails to 140 people by sending $1 mails, and asking them to put my name on the "list"... Made a bounty you know :)


A working second step? (0)

Anonymous Coward | more than 12 years ago | (#3435218)

Could this be an alternative for step 2?

1. Make a product and give it away for free.
2. Stop paying salaries.
3. Profit!

Oh... Maybe there should be some incomes as well.

No sympathy from me (0)

Anonymous Coward | more than 12 years ago | (#3435219)


took a continuing 15% paycut and NO salary for
the month of November. The company I work for
is "distributed" into small offices accross the
country. The CEO was out here last week. We basically
told him that we were giving him a vote of no
confidence. He seemed to get the message about how
un-happy we are. I'd guess we'll close the office
ourselves by going and finding new employment within
a month we're so pissed off.

I work there NOW (1, Informative)

Anonymous Coward | more than 12 years ago | (#3435220)

So I work there now - here's the skinny.

We get paid every two weeks. They're jacking 1/2 of the third paycheck in may and 1/2 of the first paycheck in June. That way - at least on paper - it's not so bad for people who have monthly payments (i.e mortgage) as effectivly you get two paychecks in each of May and June.

To respond to some other comments, it's EVERYONE over 60K, managers & sales included. It's also only US for now - as a poster alluded to this kind of thing doesn't fly so well in other countries.

No raises here (0)

Anonymous Coward | more than 12 years ago | (#3435221)

Where I work, they froze all rasies and promotions for a while. Better then job cuts, mandatory time off with no pay, or a pay cut I suppose. Plus, once that is lifted, raises will take effect as needed.

All in the life of a techie. Do think of leaving if possible if they ever say "Well, it's better then us firing you". They have been very careful with that type of saying around here, and it does help.

I envision this scene (2)

Karl Cocknozzle (514413) | more than 12 years ago | (#3435228)

Exec 1: We're not doing well this year. At this rate, we won't make profit projections.
Exec 2: We're not doing so hot this year?
Exec 3: We just spent $5 billion on our new toaster strudel division, how could we be doing badly?
Exec 2: What are we going to do?
Exec 1: Well, this will sound crazy, but, we could not take exhorbitant bonuses this year for the good of the company...
(Execs 2 & 3 tie noose and immediately execute Exec 1)
Exec 2: Phwew, that was close... Without a $1 million bonus, how will I pay for my vacation home and vacation Mercedes?
Exec 3: Well, we still have to save money somewhere...
Exec 2: Don't employee salaries cost us a lot? Let's just cut those... Hey, I wonder if I can get us a tee-time for later today... (Wanders off.)
Exec 3: Ok then, so, we cut the employees salaries?
Exec 2: (On phone) Yes Mr. Fong, two at four o'clock--Hold on-- (Covers mouthpiece) What? Oh, yeah, do whatever... It's not like those people can quit, look at the job market.
Exec 3: Great, want another Cuban cigar? I'll light it with a 20...

think about it... (-1, Offtopic)

i_have_no_name (538954) | more than 12 years ago | (#3435233)

should slashdot be considered as a DoS attack?

If you can't pay your May bills... (-1, Offtopic)

Anonymous Coward | more than 12 years ago | (#3435234)

What happens if you get fired or laid-off?

At my company... (2)

truthsearch (249536) | more than 12 years ago | (#3435236)

We were notified in December that raises for this year would be delayed until at least July. Last week we had a staff meeting in which our CTO hinted there will be no raise this year, but they'll "do what we can" for bonuses. That's BS because a couple of years ago my great private company who always gave huge bonuses where appropriate was bought by a huge public poorly managed company who gives crap bonuses. So I guess I'd be screwed even in the good times. But as far as raises go, the CTO's rationalle (sp?) is he'd rather hold back raises than lay people off. No layoffs... yet.

The market is still rough, a job is a job.... (1)

RJarett (114128) | more than 12 years ago | (#3435244)

Some of us are without jobs from .COMing and downsizing.

If any of the companies' Oracle DBAs or System Engineers want to give up their jobs due to this little pay cut, send the job my way...

7 years industry exp.
Oracle DB & iNet products, Solaris, HPUX, Linux

Bad situation... (1)

behrman (51554) | more than 12 years ago | (#3435247)

...and the company knows it.

I've never been in a position where I've been asked to take a paycut, temporary or otherwise. I've taken a paycut to switch jobs (beleive me: ANYTHING to not have to work for EMC!), and I've talked extensively with folks in the tech sector that have taken paycuts to continue working. I've always sworn up and down that I'd never take a paycut, that I'd just walk.

Four months of unemployment, however, with no jobs out there, watching the cash I had saved up to use on buying a new mmotorcycle [suzukicycles.com] go down the drain, wasting it on stupid things like rent, utilities, and food, will kind of change your perspecitve, I think. I would think that it depends heavily on the company itself, and your position in the job market:

If the company is looking strong, long-term, and you're pretty sure things are going to get much better, then it might be worth it. Taking a cut could actually help the company's cashflow problems and buy them enough time to get the next big contract, or do something rebuild.

This is probably pretty unlikely, though. I'd think that if the company has gotten this bad, you're probably looking pretty hopeless, long term. In which case, you have three options: You can quit now, quit later, or get laid off later. Quitting now means no unemployment (at least not in my state, to the best of my knowlegde), and no job in this oh-so-stellar job market. Getting laid off means that you'll be looking for a job while all your former coworkers are also looking for a job, but you'd have unemployment, most likely, and possibly some sort of severange package (but I wouldn't count on it).

I'd say your best option is to take your paycut now and start shopping for a new job immediately. Job search as though you are unemployed today and need a job. Chances are, you can keep yourself afloat on the reduced salary long enough to find a new home at a company that might be a little more stable.

There's a last option that you could explore, however, lawyers are expensive and even if you did win, there probably wouldn't be any money left for you to have, and you'd be stuck with no job, no mon-ay, and a nice, fat lawyer bill.

"ask" slashdot? (2)

tps12 (105590) | more than 12 years ago | (#3435249)

I think I missed the question.

This might be more appropriate in the "Bitch to Slashdot" section.

So this answer will probably not be welcome...

I know it is cool to talk about how stupid "management" is. Remember, "management" is not an entity. It is a group of people at your specific company. Each company has a different group of people making these decisions, so any kind of general statements about "it" are just that: blanket generalizations that are of little use to any individual.

What else you should know about these groups of people at succesful companies is, their entire job is to make decisions. The vast majority of these decisions are of the form "we have $X and we need $Y, how do we [use the extra $(X-Y)|obtain the additional $(Y-X)] in the best way?"

They know how important employees are, and they are aware of the current market realities. If they cut pay 50%, they probably have a good idea of how many people will leave, how productivity will drop, and how much they stand to make in the end. All of these are dictated by the market, and no company (in this industry) is large enough to affect the market.

These things happen...markets fluctuate, and businesses adjust in response. It has nothing to do with good vs. evil or fair vs. unfair. Rather it's the difference between businesses that will succeed and those that will fail.

Summary (5, Insightful)

Havokmon (89874) | more than 12 years ago | (#3435250)

"We're not profitable now, and we don't anticipate our income to increase (BY NOVEMBER!?!), so we must cut expenses."

Um. The company wants to become profiable by November, so they have 6 months, and they think cutting 1 months worth of IT salary is going to do it? 60/12=5 So Instead of paying out 5k per IT staff, they'll cut that to 2500. If they have 100 people, that's 250k. Anything less than that, I wouldn't consider worth the risk..

Besides, why would they need 100 IT people at over 60k?
Doesn't sound healthy to me..

My suggestion: GET OUT NOW

Keep the Employees` Faith (3, Insightful)

Silas (35023) | more than 12 years ago | (#3435253)

We're a small web-development/consulting shop, and things have definitely been a little slow over the past few months. We've found the best ways to avoid it turning into a mess like the one linked include things like:

-Always keep your employees informed about the state of things: finances, workload, potential customers, potential problem areas. Big surprises are bad, dramatic changes are bad.

-Let everybody know that their loyalty and willingness to stay through rough times will be rewarded in the good times. But, complementing that, don't expect them to take their loyalty too far (i.e. to the point where they can't live their lives, pay bills, etc) - let them know that you'll support them in whatever adjustments they need to make, including leaving if necessary.

-Use the experience, skills, and wisdom of your collective staff to find new ways to bring in income, reduce expenses, and streamline operations without sacrificing quality. Having 1 or 2 people at the "top" trying to make all the right decisions is too much - include the people who will be affected by them in the process, especially when times get rough.

-Don't do anything stupid that will put you in court, jail, congressional hearings, or on the front page of the paper. Business ethics are business ethics, through good times and bad - whatever yours are, don't sacrifice them just to save this particular ship, even if it is cutting those icebergs a little close.

How's that for a dose of idealism? But really - honesty, trust, integrity and creativity will get you through a lot more crap than a 50% paycut for your employees will. It's worked for us.

Instead of paycuts.... (4, Funny)

hndrcks (39873) | more than 12 years ago | (#3435256)

Maybe they should Roll Their Own Business Desktops [slashdot.org] as a cost saving exercise. Makes about the same amount of sense.

My Company... (1)

DaDigz (533977) | more than 12 years ago | (#3435257)

..is a great one. To save costs this year and avoid having to fire anyone, no bonuses are being paid across the board. 401k matching is also temorarily suspended. If the economy grew worse, every person in the company would take 1 day a month off without pay.

It's very nice to work for a company that respects its employees - seems to be rare nowadays.

People-cuts the norm in our business... (1)

TilRock (196653) | more than 12 years ago | (#3435258)

I'm part of the management team for a major steel producer that is currently in bankruptcy. Although I haven't heard of any 'base' pay-cuts yet, our management workforce has seen roughly a 40-50% decrease (aka - fired) over the past 18 months. There have been quite a few job combinations as well as things like taking away our pay for overtime and giving us "comp" days, and 401K matching is also out the window.

They've also broken some contracts/agreements with the union employees by laying some of the junior people off for several weeks and so forth.

Unfortunately it seems the quickest/easiest way to save money is to fire people or cut their pay. On a good note, our company is being generous to those they have let go from the management workforce. Apparently the severance package is one months pay plus pay for any vacation time you have remaining for the year. They also have hired a company to give seminars on how to write resumes and job searching skills in general for those that got let go.

Top Management screwing the ones at the bottom . (1)

cOdEgUru (181536) | more than 12 years ago | (#3435260)

Great, Boss makes a cool deal in the bonus, turns around and screws the ones beneath him. Another example of how to boost the company morality.

But then again, the current priorities in these times does not include employee morale as one of the top ten.

I remember in of my previous projects, the company blew off 100 million in an year (they were based out of Deerfield, IL) most of which was paid out to Broadvision contractors who were charging 300 Dollars per hour, for creating (GET THIS!!) the company intranet. All this for a company with around 300 employees. No wonder they burned through the whole VC fund by the next year, but the CEO still managed to get himself one of those cool G500 Merc SUV from Europe(before it was even introduced here).

In this market everyone is playing him for himself and no one else. Management doesnt give jack shit about their employees, all they care about is projecting a good-overall image out to the investors and the board and the analysts.

And one word of advice to the software engg who all of a sudden finds himself unable to pay the bills because of a pay cut. Dude..lay off on those expenses man. Like my Dad used to say, life is never meant to be simple. Start saving, or one day all of a sudden you would find yourself with out a job and nothing to do. I did!

Where I work (1)

Anonymous Coward | more than 12 years ago | (#3435261)

Well the company I am currently employed at decided to use the current market conditions and the lack of jobs in this area to give 65% of the company less than a 3% increase no matter how much was promised (even though we have been fairly profitable over the past year not to the corporate execs liking) and many employees here where not given a raise at all for various reasons. Moral here is now low and they seem to be increasing revenue by allowing the talented and strong developers to leave and have been paying top salary for sales and marketing people (It seems here anyone who reads a sales book or can repeat marketing jargon is getting paid top salary to make the developers at this company a living nightmare).

IT = what? (1)

p5 (102346) | more than 12 years ago | (#3435262)

So does this include all fields of computer study? For example comp sci, CprE, and EE grads?

Or is this article directed at MIS and other IT jobs?

Paying tthe Piper for going public (2, Insightful)

analog_line (465182) | more than 12 years ago | (#3435265)

This is what you get when your company goes public. You don't become a millionaire, your job security is at the whim of a bunch of greedy stockholders. As far as I'm concerned, going public is merely a sign of greed by all but the largest companies that do it. I can't think of 20 dot-bomb companies that actually had any damn business going public.

This is the price you pay for agreeing to work for them. Not me, and not anymore. I've had it up to here with the greed of publicly traded companies, and I'm never working for one ever again if I have anything to say about it. They're more trouble than they're worth.

Options (1)

vchoy (134429) | more than 12 years ago | (#3435267)

The choices:
(I've seen it happen...recently)
Plan A: The company wishes to survive:
1. (in Asia) Take a 20% paycut OR retain pay and work 1/2 or full Saturday. (Where as before the company's IT employees normally work Mon to Fri).

2. Head count cut (aka. 'culling').

3. Head count freeze (When more work comes and overloads, you work your butt off but as managment calmly puts it: "You don't necessary have to work hard...just smarter."

4. Not related to HR, but less spending, ie perks No more free coke machine/massage/daily fruit baskets/company paid lunches/restrict car and travel allowance expendure. Management thinking: "Instead of going onsite...can it be done remotely?"

5. Your company - the Little / vunerable fish gets eaten up by bigger fish after management sees steps 1-4 are complete.

Plan B: The company closes.
1. Get your termination letter and hope the company has enough cash (or whatever's left after liquidation) to pay your entitlements.

2. Get another job at (subjective remark: lower)market rate, but hey you might get lucky and catch yourself a nice fish.

3. Gather your work team mates, go to the company's firesale auction, buy up old hardware-software etc start up a similar new company.

Work less, or leave.. NOW (2)

Sc00ter (99550) | more than 12 years ago | (#3435268)

Just do 50% of the work, convice everybody else that got fucked to do the same.. or better yet, walk out, have a strike, refuse to do any work.. If you can get enough people to agree, then they'll have to do something. Of course that something might be to fire you and replace you with people that will do that work for 50% of the pay, but if they do this once, they'll do it again.. perhaps in 3 months they'll cut everybody another 50% because they can get away with it..

Israeli Terrorism (-1)

Commienst (102745) | more than 12 years ago | (#3435269)

Israeli Hypocrisy and Norwegian Suiciders

Monday, April 29 2002 @ 03:04 PM GMT
By Terje Maröy
For PalestineChronicle.com

A couple of years ago there was a massive outrage within the Isareli population as well as in Jewish communities throughout the world. UN personnel had seen and filmed some Israeli soldiers captured and mistreated by Lebanese guerillas.

Terje Roed Larsen made the UN release this information, according to Israeli claims. That was a breakthrough in UN policy. For two decades it would cost a UN soldier his job if he reported Israeli war crimes.

Several officers (myself among them) faced harsh consequences when they tried to forward criticism on Israeli acts in Lebanon and the occupied territories. Dozens of Norwegian UN soldiers have also committed suicide. According to Army researches several more have wished to do so. They felt guilt, according to psychiatrists within the Army's stress managing team, because they had to witness Israeli and SLA war crimes without having permission to protect the civilian victims. When even foreign witnesses react to Israeli war crimes by committing suicide, that show s the logic why the permanent victims of the oppression are desperate enough to do such acts for its people's freedom.

Roed Larsen changed, partly as a result of the Jewish reactions, the former policy of silence. UN can now report on war crimes from any part. When this new open policy of Roed Larsen backfired on Israel in Jenin, the outrage again spread through the Jewish world. The Israeli governement tried to destroy his mission. The moral seems to be that one shall report on Arabic war crimes, but not on Israeli ones. That is to me hypocrisy beyond belief.


When Israeli official spokesmen compare Terje Roed Larsen with our traitor Vidkun Quisling, they are far out of line. The Norwegian people convicted and executed Quisling for his war crimes. The Israelis made Ariel Sharon prime minister.

Terje Maröy is a Norwegian freelance journalist, working on war and conflict issues. He has also a variable military background as a paratrooper, company commander, military police officer and has served in UNIFIL headquarters in Naqoura/Lebanon.

Cheez. It is Divine, after all. (2)

dinotrac (18304) | more than 12 years ago | (#3435270)

As draconian as a one-time 50% monthly pay cut may seem, it's actually better than ongoing pay cuts in the long run. Divine may also be using this as a way to get voluntary departures.

Trouble is,
people in the Chicago area are well aware of Divine and Flip Filikowski. Filikowski was a con-man when he managed to Jed Clampett his way to a fortune with Platinum and he's a con-man now.

Not confidence-inspiring.

What's to keep the one-time May cut from being joined by a one-time July cut, etc? What's to keep it from being followed by an ongoing pay cut to match the annual percentage? Who says that anybody will get a rais next year?

Corporations in general (though I know that gratifying exceptions exist) and Divine in particular have not earned the trust and loyalty of their employees. A company that had treated its employees fairly and had earned their trust might be able to do something like this after getting feedback from those affected. Divine's "stick-it" approach is certain to have repercussions.

grace (5, Funny)

tps12 (105590) | more than 12 years ago | (#3435275)

There are graceful and non-graceful ways for a company to handle a lack of cash flow.

Which category does "subscriptions" fall under?

I-BM all over you (0)

Anonymous Coward | more than 12 years ago | (#3435277)

As an IBM contractor I got two 5% rate cuts since the new year and then today I along with many, many others got the can. Those that are left will have to take a week without pay in July.


Anonymous Coward | more than 12 years ago | (#3435278)

The reason behind this raping of employees is to keep a certain amount of funds in the bank to purchase yet another company so that they can continue to bleed money but not have to show it for a while longer. The Company is Viant Media [viant.com] We should contact Viant and let them know en masse how we feel about friends and co-workers being screwed by a company that is sinking faster than the titanic and how they don't want to be apart of said company.

Structure of "one-time cut" should worry employees (1)

randombozo (212355) | more than 12 years ago | (#3435279)

Obviously this seems bad in the short-term but the long-term prospects are even dimmer. Pay cuts are usually beyond last resort, "temporary one-time" cuts are unheard of. If the company believes it will survive and be able to continue paying the original salaries, they should have credit to avoid this situation. Any employees willing to put up with this should ask themselves what the bank knows and what they're not being told.

The second memo (the long-winded "explanation" one) talks alot about venture capitalists and cash coming from an acquisition, but completely avoids the topic of simple old-fashioned short-term debts. VC money isn't real until you have it and if the cash from the acquisition is such a sure thing, why can't they access an existing line of credit until that money becomes real?

The whole thing smells very fishy. They say the bottom line is they want to show profits to make customers feel safe. The customers are not going to feel safe knowing that the profits came from driving talent away.

To me, the bottom line looks like they have a business model that isn't profitable with current staff and also can't survive without it. So now they're casting around just trying to keep alive until they can work out another model, if they're lucky.
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