wondering if my current employer is going about this the right way, I currently work for a large ish company and we had basic pay and a bonus points system based on how much work we did. This has all been done away with now and we have a new system with basic pay, skill level allowance, personal bonus and team bonus.
After getting all the paper work through today I will be about £400 down each month with some other guys losing more than that. The company hasnt consulted with me or given me a choice in the matter and we are’nt in an union either. Can you just swap and change peoples work contracts and pay like this?

Not without you signing and agreeing to it.

constructive dismissal as it is a change to your terms and conditions – get advice- they have cut your wage – not they generally cannot just do this without your consent

Not true. If you continue to turn up for work and they pay you then you are deemed to have accepted the contract.

The gotcha here is that they may not have changed basic pay, just the way of calculating the “extras”. It would be worth seeking professional advice on this – or at least ask the company what legal advice they have been given.

advice from who though? bit wary of kicking up a fuss and being singled out

TJ tumbleweed moment …

Club together with some colleagues and find an employment lawyer to look into it for you.

employment lawyer or ACAS

An existing contract of employment can be varied only with the agreement of both parties. Changes may be agreed on an individual basis or through a collective agreement (ie: agreement between employer and employee or their representatives (trade unions or workforce representatives)).

http://www.acas.org.uk/CHttpHandler.ashx?id=316&p=0

It wouldn’t be uncommon for a “bonus” to be non-contractual and the structure of the scheme to be totally discretionary. In which case they can do whatever they wish. There is a possible exception whereby they may have created a contract through ‘custom and practice’, although a smart employer would have taken steps to avoid that. However whether its smart to piss off a chunk of your workforce is a completely different question.

JY – I don’t think you can claim Constructive Dismissal whilst still employed there you need to quit first – which might be jumping out of the frying pan and into the fire.

You resign ad sue of course if you are employed you are not dismissed
I would be surprised if bonuses and what you actually earn are not contractual never mind custom and practice.

Is there another reason we are there other than pay /remuneration?

What was that about not being in a union?

Bonuses are generally discretionary e.g. ours is based on targets set each year, so if they set the target too high, no one gets anything. Set it low and everyone gets a large payout.

You resign ad sue of course if you are employed you are not dismissed

That is not an ideal solution though. (1) It means he looses all income in the short term. (2) It means he has the uncertainty and delay of an employment tribunal hanging over him for months. (3) He may get compensation – but its not unlimited/indefinite. (4) If any potential future employer hears there is an employment tribunal they are likely to be very wary. (5) After all that it is not impossible that the tribunal finds in the employers favour and you have no job, a tarnished reputation as an unfounded trouble maker, court expenses and a load of stress. Advising someone to quit and file a constructive dismissal claim should be the absolute last resort.

I would be surprised if bonuses and what you actually earn are not contractual never mind custom and practice.

It is a very common situation. Has been in every contract I’ve ever had (even in a brief stint in the public sector which was Unionised). Has been in every contract I’ve ever given an employee – including “commission based” sales bonuses, and we would normally review the scheme annually, in line with commercial targets. e.g. if the focus is on new business (which is typically harder to get than more business from existing customers) then we might offer higher %ages for that and consequently less for those just ‘standing still’ with their existing customers. Similarly I’ve changed a bonus scheme from being calculated on revenue to being calculated on profit. We have been reasonably smart about it and ensured the reasoning etc were made clear to the staff as well as trying to show how it was possible to make as much if not more money. I know someone else who went from 100% personal to 50% personal and 50% team targets to encourage the sales guys to work together rather than fight each other. The “best” sales guys were probably worried when that happened.

Before the OP runs off to the tribunal, or even involves Acas (which is never going to be the best way to establish a good relationship with his employer) he needs to understand why have they changed the scheme. Probably because the workforce is not doing what the business needs. Is the bonus capped or can, by redirecting your efforts you achieve similar earnings by focussing on what matters.

Thanks for the advice and info so far, spoke to some other guys this morning and they are on 3k a year more for doing the same job. They have worked there longer than me but I don’t see how that works either.
Guessing its too late for us all to join a union now

Thanks for the advice and info so far, spoke to some other guys this morning and they are on 3k a year more for doing the same job. They have worked there longer than me but I don’t see how that works either.

It’s loyalty pay even the NHS has that.

As for the drop in pay, as mentioned their get out clause is probably that it’s a bonus and they’re often discretionary. As also mentioned ACAS will give you good advice.

They should not be able to mess with your basic pay. Your bonus will probably be fair game.

I guess it partly depends on their motives for the change, if it is to reduce their wages bill then probably not much you can do if they’ve not messed with your basic pay. If it’s for another reason then worth taking it up with your manager and pointing out the gross salary reduction. I’d also start looking for a new job as a back-up plan.

It wouldn’t hurt to ask politely what the rationale is and explain that it doesn’t seem fair that you’ve effectively had a pay cut. There’s always a chance they make a change to your pay. Worst case, they just say ‘tough’ and you’re no worse of.

If you are now earning less overall, then you need to ask (yourself and your manager) how it is possible to make that up again. If there is a “Skills” element, then you need to find out how you can increase your relevant skills level. That might mean some training (formal or informal) in something you already know about but to a higher degree or it could be about something the company has now decided is more important for them as a whole.

If it’s target-based stuff then you again need to discuss how you can improve your own performance and perhaps take a lead at improving the performance of your team. Make sure you know what is being measured, how and when. Get that all documented in some sort of Performance Improvement Plan and make sure you work to it.

Hopefully not hijacking but might help the OP and me to clarify, I face a similar situations.

Currently, 20% of my pay is “performance based* ie a bonus based on my directorates revenues reaching a series of targets – 100% of which gets me 20%. Its paid quarterly, against quarterly numbers.

The company wants to move to an “Annual” bonus. It appears the number will be based on what the Uber Boss determines to be a measurable success of the company. So for example: If the company is at 90% “success”, then I get 1% of the 20%. where if the company is deemed to be 100%, I get the full 20%.

Thing is “the company” is a massive US corp and I’ve no way to determine how my formerly easy-to-affect/calculate bonus is now calculated and impacted by my own performance.

I’m pretty sure like the OP, I’m going to lose out – ie be less likely to achieve the latter number towards 20% and therefore take a pay cut – where do I stand on this?

BIg Yin– its never too late to join a union, for a start you wouldn’t be on here, you’d be asking your full time official/legal dept– remember all bosses have their ‘unions’ –they have a different name– but they do the same function for them.

You need to find the appropriate one for your occupation, sometimes there are more than one, but do not hesitate to join— they will be very helpful– what have you to lose ?

Without unions and collective bargaining, this is the result, a fractured pay structure that divides and Rules….

+1 what druidh says

You can go down the lawyer or union route if you like but bottom line is you work in a environment with pay incentives and yours has just been cut. Have a talk with your manager about it, he might agree that you have been hard done by or he might have some pointers for you as to how you get better paid.

That’s one extreme view of it. On the other hand, I can see advantages to a pay structure that reflects both organisational and individual performance. If the company has a good year, why should we not be rewarded for that. Of course, in a bad year, we’ll have less. And if I work twice as hard/effectively as one of my colleagues why should I not be rewarded for that extra effort?

Its a minefield, some tasks are easier than others, favouritism is a player,surely if people work to the best of their ability you can ask no more? We all have areas where we are stronger/weaker than others— that is the role of good management, to know their workers, and employ them in the most effective manner– that to me is one of the biggest issues wherever i’ve worked, lack of understanding, incompetence, call it what you will, it is self defeating…

Which is why you need objective measurements

surely if people work to the best of their ability you can ask no more?

No – we can ask them/incentivise them to increase their abilities.

We all have areas where we are stronger/weaker than others— that is the role of good management, to know their workers, and employ them in the most effective manner–

I wouldn’t disagree, but having a system of performance measurement in place can help both sides agree that such a re-deployment might be in everyones interest. Managers and employees can both be inherently lazy and this can discourage workplace mobility.

It can be very difficulty to quantify productivity in some environments, as you must know, even what may seem straightforward in my trade– hang three internal doors , with furniture– can take twice as long from house to house dependant on many factors, should i be paid for the hours or the productivity?

@OP – it depends what your current contract says as to whether they can change this without consultation (eg your current contract may explicitly allow changes without consultation, you may not even have had a fixed salary)

@rudeboy – and with unions we have officials on £100k and living in subsidised housing all paid for by their members. Look what Unions did for British Motor Manufacturing – smart eh ?

The company wants to move to an “Annual” bonus. It appears the number will be based on what the Uber Boss determines to be a measurable success of the company. So for example: If the company is at 90% “success”, then I get 1% of the 20%. where if the company is deemed to be 100%, I get the full 20%.

My company is similar, only a lot smaller. Whilst indirectly we all affect the bottom line, to a greater or lesser extent, there’s not a lot of correlation between how hard I work and our turn over.

Personally I don’t agree with bonuses at all. If the company makes it, we all get what we were expecting and no real motivation. If we have a bad year and get nothing, through no fault of our own, then you just annoy the staff who don’t get the bonus they were hoping for.

NB The last two years the payout has been zero as the CEO has been running the business into the ground. Luckily he’s just been fired, so we’ll see if the new guy is any better…..

Which is why a proper measurement needs to be put in place. To take your example, it would be crazy to look at performance over such a short time period. If “hanging doors” is the measure and you are doing 3 a day then you’ll be doing 600 a year. Variations in difficulty will tend to be averaged out over this period – one day you’ll get the hard ones, a couple of days later I will.

Who says that will happen , the tasks are allocated by a manager, he may favour me over you, this is common, its not always conscious, sometimes its –he always does that task’- or your ‘better’ –

For info only, the time for an internal door with all fittings was 90 mins, but if you knew how to ‘add ‘ extras- this can take it out to 3 hrs– all jobs have flexibility, i find that if you pay people a decent amount they are willing to work for it, the opposite is also true.

Jambalaya– unions wreck industry — you serious ?

Jambalaya– unions wreck industry — you serious ?

Wreck. Not in general no, of course not. In certain specific industries yes (as per my point with motor manufacturing)

PS thanks for compliment on other thread, now I’m feeling a bit guilty 8)

Look what Unions did for British Motor Manufacturing – smart eh ?

What are you on about?Basically they sold really rubbish cars that no one wanted to buy. Was this the unions fault or management? Its not hard to work it out even
FFS the rescue cars for the industry were
Mini Metro, Maestro, Montego and another Honda collaboration the Rover 800
Bloody Unions eh 🙄
That is what ruined it really crap cars and that is not the unions fault.

We still have a successful car manufacturing base it is just that they are no longer British owned so they seemed able to work with the unions but they could not sell the crap cars BL made

By 1968 UK motor vehicle production was dominated by four companies: BLMC, Chrysler (UK), Ford, and Vauxhall (GM). The national champion, BLMC, was handicapped in its attempts to modernise by internal rivalries. Unattractive new products, retention of legacy marques and models, labour disputes, quality issues, supplier problems and inefficient use of new equipment thwarted the dream of efficient high volume production. Increased overseas competition, arising from lowered tariffs and membership of the European Union, and high unit costs, led to low profits, which in turn jeopardised investment plans. BLMC’s share of the UK market dropped from 40% to 32% between 1971 and 1973.

The Triumph Dolomite Sprint, in production from 1973 to 1980.
By 1974 Britain’s position as a world motor vehicle manufacturer had dropped to sixth place. In 1974 both BLMC and Chrysler UK appealed to the Government for financial help. The Government rejected the idea of a BLMC/CUK merger, and instead CUK received a loan and BLMC was subjected to a series of studies to determine its future. The Government’s official BLMC enquiry, led by Lord Ryder, suggested that BLMC’s strategy was sound, but required huge Government investment to improve productivity by providing mechanisation and improving labour relations. Despite the effective nationalisation of BLMC as British Leyland (BL) in 1975, the recovery never happened. Chrysler sold its European interests (including those in the UK) to Peugeot in 1977, to allow it to concentrate on its own difficulties in America. The UK interests were renamed Peugeot-Talbot.[19][21]

The Austin Metro, which was introduced in 1980
By the end of the 1970s Ford, Peugeot-Talbot and Vauxhall (GM) were well integrated with their parent companies’ other European operations. BL stood alone in the UK as an increasingly junior player. As part of the drive for increased productivity in the late 1970s, BL reduced its workforce and number of plants, and strived to centralise its management activities. The city of Coventry suffered particularly badly, with many thousands becoming unemployed. In 1979 BL struck a collaboration deal with Honda to share the development and production of a new mid-sized car (Triumph Acclaim/Honda Ballade). The new car combined Honda engine and transmission designs with a BL body. Although the UK political scene changed in 1979 with the election of the Thatcher government, the Government continued to support BL with funds for the development of a new mass-market model range (Mini Metro, Maestro, Montego and another Honda collaboration the Rover 800). Car assembly, with the exception of Jaguars, was concentrated into two central plants – Longbridge and Cowley. In July 1986 BL was renamed the Rover Group.[21]

I’m not an employment lawyer, but my wife is. Have a look at your contract. I’ll bet it states bonuses are non-contractual, payable at the sole discretion of the employer.

As for someone else paid 3k more, there is no requirement for equal pay for different people, unless it discriminates on grounds of sex, race, religion or age. Even then, it is sometimes allowable if objectively justified.

If you work for a big corp, any change like this would be drafted by the lawyers ( hence change to bonus, not basic) and I would be amazed if they did it unlawfully, when there are so many ways to do the same within the law.

thanks for all the info guys, looks like I need to dig the contract and the bombers out