Comstock's magazine 0419 - April 2019 - Page 22

n EVIL HR LADY DILEMMA OF THE MONTH CUTTING EMPLOYEE PAY by Suzanne Lucas ILLUSTRATION: JOHN CHASE I 'm a partner in a small business (we have three partners and seven employees). A few years ago, we went through rough financial times and cut everyone's pay, including the partners, by 20 percent. When things improved, we raised the pay back up. Now, we're in rough financial waters again and need to do another pay cut — and we'll likely lose our best employees. Yet the alternative is to go out of business, putting everyone out of a job. Besides an angel investor coming in and saving us, is there anything we can do? A 22 | April 2019 WELL, PRAYING FOR ANGEL INVESTORS ISN’T THE WORST IDEA, but I lack faith in this particular area. If you’re not prof- itable, getting an influx of cash will just prolong the inevitable unless you make some very real changes. So, what chang- es are you going to make? This is a very important question be- cause cutting pay didn’t solve the prob- lems. Previously, you did cut pay the right way — some businesses make sure the leadership continues with their high salaries and bonuses while the worker bees get their wages slashed, but you cut pay across the board. As long as every- one is making at least minimum wage and is told before the pay cuts occur, it’s legal. (Remember, California has lots of local laws regarding minimum wage for employees, so double check!) But now you’re looking at cutting wages again, and it’s doubtful your staff