Inflation and a slowing economy are prompting more people to consider postponing a job change. However, the job market is still hot for IDA members, reckons chief economist and career counsellor.
IDA's legal advisors give good recommendations on what to keep in mind if your employer wishes to cut your working hours and salary.
As a result of the Corona crisis, IDA is experiencing that some employers, facing financial challenges, want to decrease IDA-members' working hours and pay. Such changes, despite scope, are always to be regarded as significant changes in position and must, therefore, as a rule, give the employee a fair opportunity to consider. However, for liquidity reasons, the employer often wants changes to apply immediately, but it does require the consent of the employee concerned.
IDA focuses on constructive dialogue and helping to ensure that the collective agreements consider this specific situation companies and employees are facing.
Typically, our members are given very little time to accept or refuse the agreement, but since a decision to take a pay cut can have a major impact on anybody's living and family situation, the employer should give the employee a fair opportunity to consider and respond to the proposed change.
It is often a case of being faced with the election between coming to an agreement to working hours and pay cut or being made redundant. Unfortunately, it is rarely possible to negotiate the terms that management presents.
On the other hand, if you are made redundant after you reach an agreement, it might be a better option to come to an employment severance agreement and then find a new job.
It can be a costly affair without a proper agreement, and you should, therefore, contact IDA and your A-kasse (Unemployment Insurance Fund) before you accept one. Then you would be better off, that is, in a more desirable or advantageous position if the company wants to make you redundant or goes into bankruptcy.
Please note that if your employer dismisses you because you declined a working hour and pay cut, it may be unlawful because it violates part-time law unless your employer can prove that ending your employment is in no way justified by your rejection of working hours and pay cut. However, you should be aware that if your employer is bleeding cash, it is not difficult for the company to meet its burden and dismiss you.
This is not a pleasant situation, but there are several things you should try to include in your agreement:
In addition to these conditions, you should always contact your Unemployment Insurance Fund, as an agreement on working hours and pay cut will often affect the right to unemployment benefit and the right to early retirement.