T Nation

Congratulations, Here's Your Pay Cut!


I've been happily employed with the same company for the past 16 years. My salary has always been under market. I didn't mind for the first few years because I needed to have a job in this area while my wife went to grad school. After she was done with school I was still happy with my low salary because the bonuses were going up. A few years later the bonuses reached a really nice level and I was very happy with my total pay.

Recently my boss has decided to retire and they are promoting me to head R&D. Great right? No. My boss is retiring because he doesn't want to put up with shit from the head of sales anymore. The head of sales is also one of the 4 owners. So the board in their infinite wisdom has decided to give oversight of R&D to this bitch.

She smiles to my face and tells me she's giving me a fifteen thousand dollar raise (turned out to actually be 14,800). I say "that's great but what's happening with the R&D bonus?" Her response is they are terminating it. The R&D bonus has been worth about 30 grand to me for the last few years. I also just learned that since R&D is over paid, we have been excluded from the most recent corporate bonus. I haven't found out yet if that's a permanent change or a one time exclusion. I have to assume its permanent because her MO is to try to pay the least she can get away with. The corporate bonus has been worth about fifteen grand to me. So, with my promotion, I got a fifteen thousand dollar raise and a 45,000 dollar bonus cut for a net loss of 30 thousand.

When I joined the company 16 years ago, the company was barely surviving. Bank auditors were in every month going over the books. The plant was generally operating at 20-30 percent. The bonus plan was an incentive to try to build the business. We've done that and in the process we made a good amount of money and we made the owners millionaires. The head of sales makes a salary of 300 grand and that's just salary. She probably makes another 2 or 3 hundred grand in owner dividends yet we're the ones who are making too much.

I've also recently learned they're pulling the same shit on production. Production employees have worked tons of overtime. Remember, capacity is maxed out so a lot of people are having to pull double shifts. So, their bonuses are getting cut so their pay is more in line with what they think 'production' workers should make.

In the last month I've gone from believing my company was interested in rewarding success to believing they want to pay us the least amount they can get away with. I really hate the idea of having to uproot my family and move across the country. I also hate the thought that I have to make a power play. They would be fucked if I quit, but to make such a move I have to have a job lined up and be prepared to move in case my play fails. Even if my power play succeeded I'd still be with a company that I now believe wants to pay me as little as possible. Fuck. That's really the bottom line, regardless of the actual dollar figure I make, a company that wants to reward success makes me happy, a company that wants to cap pay makes me want to quit.



Do not try anything until you have another job lined up, as in you have an offer. Given the current economy and a noted practice of some companies not hiring people who are unemployed because they are been viewed generically as the most unproductive or they would have a job, you need to make sure you have a job. Moving suck, my dad was a corporate gypsy towards the end, but I am pretty sure unemployed is worse.


Time to brush up your resumee and jump ship.


Yeah, times are hard, blahblahblah, but you dont want to tank with these fuckers dont you?


That shit sucks, bro. I recently got fucked in the ass career-wise myself. Think of your family before you jump ship. Be SURE you have a SURE THING before making any power plays or giving notice.


Corporate greed huh, maybe you should head down to your local Occupy rally.

In all seriousness though, this is a toughie. On one hand you sound like angry and whiny person but on the other, you kind of have a point. I say the former because your situation is really common in a normal corporate entity. The way a corporate structure works is that the directors/owners make the big decisions, which obviously includes remuneration and expenditures. Your business is run like most businesses out there with the shareholders' (owners') interests at mind first and foremost. In today's economic climate it's not surprising companies like yours are looking at ways to at least maintain owner returns. Call it corporate greed, efficiency measures or whatever, you're a consequence in something bigger than you. It sucks but hey, business is business. Be grateful they aren't firing people instead.

However, it's hard not to feel for you too. You say you're already under-paid according to the going market rate and the balancing measure in all of that, your bonuses, are being cut and unfairly re-balanced. Your dissatisfaction is a reflection on higher management's performance and policies. I'm sure most on here would agree you have a legit protest.

How you want to go about it is your business. If you feel like you're getting significantly shafted and you can't reconcile with your bitchy boss then fuck it, just quit. If you believe you're an important figure in the company's success then threaten them with resignation and see where that leads. Alternatively, you could absorb your momentary anger and wait it out to see what happens, maybe they will eventually change policies.


you are replaceable. remember that when you consider your "power play".



"Raise or quit" is the worst move ever. Even if you do get your raise, the real problem is the amount of resentment you will incur should you get your raise - both from your new boss who has cut your pay as well as the multitude of underlings who also received pay cuts.


Have you brought this $30,000 loss to their attention. Id assume you have given your presentation but wouldnt that be first and foremost?


Everyone is replaceable, however, not everyone is easily replaced. It's becoming more and more apparent that even though there is high unemployment, there is truly a lack of qualified talent in some industries. I work in a city of 33,000 that has a huge unemployment problem, yet we are always looking for qualified people.

IMO you are fucked in your current position and it is time to move on. My wife just went through the same thing in a very good job after a change in management. The pay cut is just the tip of the iceberg. No power play for more money, just find another job before you become miserable.

Also, as far as pissing off upper management, who cares? Just be professional when you give your notice and don't bad mouth them. If you have talent, which it sounds like you do, you will find a job. Just be prepared to have to work yourself back up in pay.



To second, or maybe 11th at this point, it's time to move along.

Stay professional, act happy but definitely look around. Don't do anything drastic until you land something else.

You are in a dead end it sounds like.

Rebuilding somewhere with opportunity to catch up and then go further would be worth it, IMO.


Might be time for a exit strategy; your supervisor's MO of cutting it to the bone is probably in line with how she makes herself look good to her superiors.

IMO it was/is a mistake to come to rely on the bonus; it is what it was, a bonus. It sadly was up to the company & its current management to revoke/trim/do away with it.

In your 16 years I'm sure you've at least built up a network of business/industry/personal connections so that when you jump ship there will be some opportunities thrown your way, no? My other question is: is your field so specialized you have to move that far away? Nothing in a related field close by?

All in all like others have said, think of your family before doing anything. While most men live lives of quiet desperation at their jobs sometimes (raises hand) a job, any decent paying job is good to have right about now, despite the nest of snakes at the top of yours it seems.

Keep smiling; it'll make them wonder what you've been up to, & all the best. Keep us posted.


That power-sucks.

But I think you're totally correct - get a job lined up, secure a guaranteed offer, then notice out.

I'm guessing the Head of Sales knows you're taking a $30k paycut when I say this, and the maliciousness inherent in the action is a sign the company is about to take up her attitude.

Going gypsy sucks for all involved, but if it's a choice between that and not getting in enough protein, then I say go.


If you don't like your job get a new one. Your promotion, new title, and salary increase should be a good stepping stone.

If they really need you and are underpaying you, they might counter.


If your job is not unbearable, stay in it and line up something else.

One of my best buds quit his job where we used to work (a Big 4 accounting firm) and stayed unemployed for 6 months while piling on debt.

When I got sick of my job, I toughed it out until I got an offer. Having a job allowed me to counter-offer saying the offer I got was already at the same pay I had, so I needed a switching premium! And it worked, my new employer upped the offer by 11%.

The point is, your current job is still useful to you as negotiating leverage and as a debt avoidance mechanism. Update your CV and get going.


While I agree you're getting hosed, your pride won't matter one bit if you're completely out of a job for months and you're piling up debt.

Make sure you have a soft place to land. In this economic climate all you're doing to that company is giving them an opportunity to find somebody to fill your spot for less $ if you just up and leave. Very doubful their feelings will be hurt in the least.


I did this too, even though the company I was in was swirling the drain. Also much easier to get a job if you already have one.


You biggest mistake is trusting your company. NEVER trust a company and never believe a fucking thing they say....

So my line of questioning goes as follows.

  • Are you making more than you were before? If not, can you turn down the promotion?
  • What is the state of the company? I mean are they financially stable, are they headed in the right direction interms of maintaining the business shit like that? Bottom line are they in a position to stay in business and are you in threat to get laid-off?
  • There is more to consider than money, what about vacation time and benefits? Remember any where you go, you are starting over with that shit.

  • Like everybody said, make damn sure you have another offer before you start banging you dick on her desk. Companies don't love you, they don't care about you at all, so banish that shit out of your head permanently. Keep in mind though, their is much more to consider than your pride and principal. You have to consider your family and your current life style. You can't just uproot your family and change your life because your company is a bunch of dicks.

In conclusion, if this promotion is more money and is something you want to do, then it's probably worth taking even if it's not what it used to be. Now if you are going in to a situation where your new boss is an asshole and you can avoid it, I would. If your boss is someone you can address in a professional matter with concerns I would go in there and negotiate. Something to the effect that 'I know what this position used to pay and I am concerned that it isn't what it used to be' perhaps you could get something else out of it like stock options, or more vaca, something. It really depends on the personality of the folks you work with....

Know this, companies love money, they don't give a flying fuck about their employees at all. Keep in mind also, that if you go to another company there is just as much bullshit in the next place. So the grass ain't really greener. You leave if the situation is untenable.


What degree do you have? What networking have you done outside your company?


I think its a little more complicated than that.

Given OPs time with the company and being in an R&D branch, he's probably not as easily replaceable as the company would like.

Also, given that one guy just took off and the OP is unhappy with the situation, the company risksa bunch of employees leaving which would be no good. After the first wave of people pissed off, they face the second rush when the first wave of resignations finds new jobs and start asking if their old buddies and colleagues want to come work with them.

The economy might be bad, but the job situation is definitely slanted towards the lower end of the spectrum in towards of education and experience levels. Depending on the industry, OP may be alright putting the ultimatum down.


I was in a similar boat a few years ago - pay was good, but after 15 years I was tired of same bull shit & politics. As a result, my performance headed down hill. I quickly lined up a new job and moved on.

Best thing I've every done for myself, except marry the lady that will put up with me.

Also, YOU ARE REPLACABLE, maybe not in short term, but you are, especially in this market.

Get a job lined up before you do anything.