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Pay Reductions During Pandemic  
Posted: 03/24/2020 10:19am   94 Views


Hello Everyone: I just read that the owner of the Philadelhia 76ers and New Jersey Devils is considering a pay reductions for salaried employees (over $50,000 annually) up to 20%. 

My question is if companies are considering a "tiered reduction" approach, what are the tiers and percentages?  For example is a tier setup as follows reasonable: 

  • Salaried employees earning $50,000-$75,000: 5% reduction
  • Salaried employees earning $76,000-$100,000: 10% reduction
  • Salaried employees earning $101,000-$125,000 15% reduction
  • Salaried employees earning $125,000 20% reduction

This is just an illustration for discussion.  Please let me know your thoughts.

Thanks and be well!



Pay Reductions During Pandemic  
Posted: 03/26/2020 04:18am  

We considered something similar to this, but we planned to align the tiers based upon our internal classifications (ie: Executives  70%, Salaried Exempt 75% ). We were modeling an extreme, and the math works out that 70% is the lowest we could go for exempt workers without dipping below the $684 threshold for exempt status.


We also had some discussions around what meets the 'bona fide" criteria listed in #7 from the WHD/DOL fact Sheet #70


After much discussion, we have not made any reductions at this point. An (unconfirmed) news article listed a local company plan to cut Exec's to 40% and remaining Salaried Exempt to 50% for the month of April.


Pay Reductions During Pandemic  
Posted: 04/02/2020 10:47am  

We are based outside the US and have implemented a tiered pay reduction for a period of 3 months. It applies to professional and managerial levels only and is between 10% and 30% of their basic salary. Thee total monthly salary is made up of 70% basic salary and 30% allowances.

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