Question: What are the proper steps for a company to follow when tasked with informing employees of a decrease in their pay?
Answer: In this circumstance, the company’s formula for determining an annual increase in pay is based upon market share and employee tenure. The employee in question was not notified that their market share had declined before a decrease in their pay went into effect. The company’s compensation analyst claimed that the employee might have been verbally notified, but appeared uncertain of this fact. Neither the employee’s director, nor their manager stated that they were aware of the pay decrease. The Human Resources Department responded to the situation by issuing a memo to the Vice President and all directors, which included information regarding the date of the pay scale revision. Continue reading