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Old 01-22-2013, 10:10 AM   #21
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I agree that it makes a big difference if it were one person as opposed to the whole staff....

But, a company is in business to make a profit... if they are not making it because labor costs are high, then they need to reduce labor costs... a long time ago that meant laying off workers and hiring new workers at a lower cost.... I think the new way is to cut salary to workers and hope enough stay to keep the door open...


Look at Hostess... I am not sure if they were run well or not, but they wanted to cut salary to stay competative... the union disagreed and they have closed shop... lots of people that wanted to work at the lower wage got laid off...

So, I do not have a big issue with it either way.... the guy has to decide if he is still being paid what he thinks he is worth... and if he does not he can sell his services to another company that is willing to pay more...
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Old 01-22-2013, 10:17 AM   #22
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You're All Fired

A few months ago, some of my former cow*rkers called to let me know that the company owner (a vile, sad, unhappy excuse for a person) informed them via email that effective at end of day he had sold all the assets of the company and they would all be terminated. The email went on to say that through his tough negotiations he was able to get the acquiring company to offer all employees their old position, but that he would be unable to pay them for accrued vacation or make the company 410k match for the year. Working through the acquiring company's HR department they were able to shame the mutha****** into paying their vacation and 401k match.

By the way, these employees are the ones that made him a multimillionaire.
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Old 01-22-2013, 10:35 AM   #23
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I think the executives proposing this should lead by example, and be the first ones to adopt this new pay/work hour arrangement
Eh, all animals are equal, but some are more equal than others.
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Old 01-22-2013, 10:40 AM   #24
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... By the way, these employees are the ones that made him a multimillionaire.
Makes me wonder why they didn't just do it on their own then, y'know - cut out the 'middleman'? They could have had all those multi-millions to themselves.

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Old 01-22-2013, 11:02 AM   #25
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Just curious.... why would the top sales people leave IOW, if they are good, then they should be making quota easily even if it were raised...
I wasn't included in the discussions but the fact that they left indicates clearly that that's not the case. Quotas based on what the enterprise demands in terms of returns are not guaranteed to be reasonable, as they would be if they were based on the capacity of the operations and the marketplace's receptiveness to making a positive purchasing decision.

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Now, if they also dropped their salary because of the higher quota, that is a different story....
I'm sure you meant "commission rate" rather than salary, and I think we can safely assume that if it is the top people leaving a job they're doing so because the changing rules are going to substantially disadvantage them.
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Old 01-22-2013, 11:09 AM   #26
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If your employer cuts your pay by 20%, but then lets you increase your hours by 20%, so you have the same take-home pay, what kind of message is your employer giving you?
The message is: "The job market sucks and we intend to exploit it no matter how our business is doing... because we can and you have few options."

Unless you are FI, of course. Then you can tell them to pound sand and walk away. (This is another reason why it pays to be FI even if you *don't* plan to retire early. It gives you the option to get out of a crappy future situation.)

Also, this helps them reduce health care and other benefit costs because if you work 48 hours instead of 40, it takes 10 people to do 480 hours of work instead of 12. Thus they have to pay out benefits to 16.7% fewer people, and the benefits tend to be a fixed cost per worker.

The bottom line is that there is less correlation between a company's compensation policy and their economic performance than I can ever remember. Employers know they have their workers by the you-know-where and are not shy about padding their profits by taking advantage of their leverage. This seems to be most true for publicly traded companies where shareholders demand that management screw their workers because the market allows it, not because the business is struggling. Cut their pay, eliminate their health insurance, give us an extra 2 cents per share or you're OUT!
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Old 01-22-2013, 11:55 AM   #27
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Back in the day my MegaCorp "asked" all management people from the CEO to first level supervisors to "volunteer" to work a week without pay. This did not apply to non-management people. The stated reason was so that MegaCorp could meet its published objectives for the year. You were not allowed to take vacation or personal time.

In the first round there were almost no "volunteers". MegaCorp came back and said that this was not really "voluntary". After that I folded (fortunately, I was FI at the time) and almost everyone else did also. The identities of those who still refused to "volunteer" were made known to their co-workers. This was via the grapevine, not officially, of course

As far as I could tell the refusal to "volunteer" did not obviously affect anyone's career.
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Old 01-22-2013, 12:43 PM   #28
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This is another reason why a person should strive for financial independence early in their career. It allows you to drive the train rather than being taken for a ride.
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Old 01-22-2013, 02:47 PM   #29
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My last boss at megacorp used to butt heads with corporate alot. They once backfilled his timecard with his vacation time for comp-days he took (worked his 40 ... took friday off ... they took 8 vacation for friday).

So his saying was "They'll pay 10 FOLD". Then promptly booked a business trip near his ocean front condo and "worked from home" for a couple weeks. Logging 8 hours M-F ... no questions asked.

Point being screwing the employee only works in the short term.
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Old 01-22-2013, 05:27 PM   #30
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Point being screwing the employee only works in the short term.
Just curious: When was this?

I worked in Silicon Valley in the late 1990s and it might have worked then, especially for someone with a skill set in very tight demand. I can't imagine that working for 99% of corporate drones in this environment.
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Old 01-22-2013, 06:20 PM   #31
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A few months ago, some of my former cow*rkers called to let me know that the company owner (a vile, sad, unhappy excuse for a person) informed them via email that effective at end of day he had sold all the assets of the company and they would all be terminated. The email went on to say that through his tough negotiations he was able to get the acquiring company to offer all employees their old position, but that he would be unable to pay them for accrued vacation or make the company 410k match for the year. Working through the acquiring company's HR department they were able to shame the mutha****** into paying their vacation and 401k match.

By the way, these employees are the ones that made him a multimillionaire.
In most states accrued vacation is payable at termination, it doesn't matter what deal he made with the purchasing company. The employees should consult an attorney who specializes in employment law.
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Old 01-22-2013, 06:34 PM   #32
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Not in Texas without a written agreement:
(a) For purposes of 61.001(7)(B) of the Act, vacation pay and sick leave pay are payable to an employee upon separation from employment only if a written agreement with the employer or a written policy of the employer specifically provides for payment.

http://info.sos.state.tx.us/pls/pub/readtac$ext.TacPage?sl=R&app=9&p_dir=&p_rloc=&p_tl oc=&p_ploc=&pg=1&p_tac=&ti=40&pt=20&ch=821&rl=25

Having said that, this is the first and only employer I have ever known to attempt to withhold accrued vacation pay on termination. See my description of the former owner in the prior post. I left out a few adjectives, greedy being one of them.
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Old 01-22-2013, 07:45 PM   #33
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**but it's just like the stock that goes down 20%, and then goes up 20%.


Even worse.. coprorate profits go from, say, 100 whatevers to 25. Off 75%. Then simply return to the previous level of 100 and the headline screams "so-and-so's profits quarduple!" Sigh.
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Old 01-22-2013, 09:41 PM   #34
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You are selling your time. You get to decide: price cut or sell your services elsewhere?

Personally, if these pirates are inclined to do this to the workers, you are likely to be there when they close the doors. Dust off the resume.
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Old 01-23-2013, 12:06 AM   #35
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Within a year of joining my former employer. It was announced that all salaries were being cut by 10% (except for directors and above who took a 10% cut and eliminated executive bonuses) we are all told that in addition we were all told that from now on we were expected to work 10% more per week; and our "flex tim"e was we could arrive anytime before 8 AM and leave anytime after 6 PM except on Fridays when 5 PM was allowed. Hourly workers were exempt from the 10% more hours. (I think plenty of guys learned how to operated office machinery when the admins left at 5... )

Times weren't great in Silicon Valley at the time, so I and most of my coworkers stuck with it, thankful that we were not part of the large number they were laid off. They did however grant additional stock options, and repriced existing ones to $.625/share.

About a year and half when the company returned to profitability. They threw a big party, gave us a bonus to that made up for our lost wages and announced a new profit sharing plan. Reading accounts later, the company was fairly close to going under and the RIFs and pay cuts quite possibly made the difference between survival and bankruptcy and if management did not do this I probably wouldn't have retired early.

I guess the point being that in not all cases is upper management trying to screw its employees. Although in general I agree with Ziggy, in this job market many corporations are ruthless cutting wage expenses, because they can.
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Old 01-23-2013, 01:55 AM   #36
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In most states accrued vacation is payable at termination, it doesn't matter what deal he made with the purchasing company.
This does not appear to be so. In a few state, notable California, this is true. But in the vast majority of states the law only requires that accrued vacation is payable at termination if the employer policy is that it be so. Employers with a policy of not paying vacation time are permitted to not pay any accrued vacation in accordance to whatever policy they adopt.

State laws on vacation pay after termination
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Old 01-23-2013, 09:16 AM   #37
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In most states accrued vacation is payable at termination, it doesn't matter what deal he made with the purchasing company. The employees should consult an attorney who specializes in employment law.
Brat, what I believe you are referring to as a "deal" is the former owner taking credit for getting the acquiring company to hire the people. (If that really happened, who knows if the commitment to keep those people has a time limit?) He told the employees he could have gotten more from another place that planned to fire many of the employees. Nobody believes him. He is not trustworthy.

These are professional workers. I know at least one who contacted a lawyer.

It is a small place that has been steadily shrinking for several years. There were probably less than 20 left.
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Old 01-23-2013, 09:17 AM   #38
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I guess the point being that in not all cases is upper management trying to screw its employees. Although in general I agree with Ziggy, in this job market many corporations are ruthless cutting wage expenses, because they can.
It isn't in all cases, but in *this* economy, it happens a lot even with a company posting record profits.

For example, if a Silicon Valley business tried this in 1998, they would quickly be hit by a massive brain drain. These days they know they have almost all the leverage in most cases, and they aren't shy about wielding it. Even if they are posting record profits -- it doesn't matter.
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Old 01-23-2013, 09:28 AM   #39
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About a year and half when the company returned to profitability. They threw a big party, gave us a bonus to that made up for our lost wages and announced a new profit sharing plan. Reading accounts later, the company was fairly close to going under and the RIFs and pay cuts quite possibly made the difference between survival and bankruptcy and if management did not do this I probably wouldn't have retired early.
My former employer did something similar. We were very heavily reliant on the real estate development industry, so 2008-2009 weren't pretty years. 10% pay cuts to managers, 6% IIRC pay cuts to the grunts. RIFd 25% of the employees in 1 cut, then another 25% left within a year. I think everyone understood that the cuts were necessary to keep the company from going under. In hindsight they didn't have to be that steep.

Now the company is doing great, and has returned to pre-2008 profitability (with a smaller staff). They reinstated pay before I left in 2010, and now they are back to paying bonuses and giving regular raises. As a partial owner of a few percent of the company via my ESOP I'm pretty happy with the stock price increases last year!

Some competing companies and some of our clients went totally belly up during 2008-2009, others cut pay 10-20%, some cut 2/3 of their workforce, etc. Most of those that cut hard and deep early enough are still around and profitable today from what I have seen. At my former employer it was a great time to separate the underperforming employees and keep the best employees (which in spite of management's general ineptness, they executed fairly well).
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Old 01-23-2013, 10:21 AM   #40
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This does not appear to be so. In a few state, notable California, this is true. But in the vast majority of states the law only requires that accrued vacation is payable at termination if the employer policy is that it be so. Employers with a policy of not paying vacation time are permitted to not pay any accrued vacation in accordance to whatever policy they adopt.

State laws on vacation pay after termination
It is true in Oregon and Washington as well. Many states have an 'agreed rate of pay' statute. It has been years since I worked in NY and NJ, they had comparable requirements at the time.
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