Changing Employee Pay

Changing Employee Pay

Changing employee pay is rarely a problem when pay rates increase but sometimes employers need to make other changes. Recently Bruce Atchison bravely put his hand up and confessed that the way Aseco Electrical reduced their wage bill early in our abrupt nationwide change to Level 4 lockdown was not compliant with the Employment Relations Act. (See this article for an interesting little read.)

Just because we have had unilateral change to the way we can operate our businesses does NOT give us permission to unilaterally change what we pay our staff.

If we do not follow what the Employment Relations Act would call “fair and reasonable process”, we run the risk that this could come back to bite us. The ERA can impose a fine of up to $20k (some or all of which goes to your worker), or you could be forced to pay your employee(s) back everything owing. Not fun.

In the spirit of the FixHR attitude, get in early, negotiate and capture your process, and proceed knowing you’ve done everything you needed to. Our staff have the right to earn what they have always earned. Consequently we need to negotiate with them fairly in order to make any changes to that.

Please contact us if you have any questions or need support as you tackle reducing your staff’s wage or salary. We are here to help.

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