Executive pay cut request: How to respond?

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simas
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Re: Executive pay cut request: How to respond?

Post by simas » Sun Apr 12, 2020 9:35 am

SandysDad wrote:
Sun Apr 12, 2020 7:18 am

I agree with those that believe if everyone is asked and you decline it puts a target on your back.
it depends on whether or not you care about it. I find the whole worry about 'target on the back' weird , imagine the situation reversed

you walking into the bank and telling them that from now on they are decreasing your mortgage size by 25% , just because COVID, aliens, moons of Saturn whatever. or you 'would put a target on their back' and do not deal with them in the future.. what do you think the reaction would be?

if you made an agreement with me to pay me X, you may be X. you can terminate the agreement which is your right but I do not understand the game of up or down adjustments. Same from my side. If I hired you to do the job for Y, I will pay you Y . If I can not afford Y, I will not do the job with you..

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canadianbacon
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Re: Executive pay cut request: How to respond?

Post by canadianbacon » Sun Apr 12, 2020 9:38 am

SandysDad wrote:
Sun Apr 12, 2020 7:18 am
I agree with those that believe if everyone is asked and you decline it puts a target on your back.
Sports Illustrated just fired their senior soccer writer for not taking one (although they handled it in such a clumsy way they're almost certain to get sued).
Bulls make money, bears make money, pigs get slaughtered.

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Re: Executive pay cut request: How to respond?

Post by KyleAAA » Sun Apr 12, 2020 9:45 am

New Providence wrote:
Sat Apr 11, 2020 7:12 pm
Archimedes wrote:
Sat Apr 11, 2020 3:07 pm
I am an entrepreneur. I make a 7 figure annual income. I built my own successful company.

I don’t enjoy going to the expensive lawyers and accountants all that much. I may get more interesting advice when I post on bogleheads or on a forum in my industry. Sure, I may then bring forward some of those ideas to the expensive professionals, but I still get good ideas and appreciate the discussion right here. I also like to think that I know how to spot good advice and how to ignore bad advice, but no matter what, I quite often benefit from the discussions on this forum.

Please be polite and respect the OP for the question posed. Rich people have feelings too! Go ahead and present a thoughtful answer, or otherwise, you could simply opt to reserve your right to remain silent.
I agree with your comments. But it is logical to expect an extremely high level cognitive abilities of somebody making a $1 million a year. Note that it is very different to be "rich" than to make a $1 million salary. A very uneducated person can become rich by winning the lotto, or one dummy person can become very rich by luckily receiving shares prior to IPO. We are talking here about a corporate salary.

I'd say that most developing countries in the world have no person making a $1 million yearly corporate salary outside of the CEO. At a minimum, I'd expect a person at that level to have extremely sound insight, judgement and decision making skills.
I'm not sure exactly what this means, but are you arguing that asking for advice on an online forum shows evidence of lack of such skills? Why?

Kiter
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Re: Executive pay cut request: How to respond?

Post by Kiter » Sun Apr 12, 2020 10:30 am

NOT a corporate guy here. Seven figure investments,6 figures down,seven figure cash equivalent. In reading this I feel if execs. can't or won't take cuts to help their companies to hell with bailouts ! Let them fail !

stoptothink
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Re: Executive pay cut request: How to respond?

Post by stoptothink » Sun Apr 12, 2020 10:50 am

KyleAAA wrote:
Sun Apr 12, 2020 9:45 am
New Providence wrote:
Sat Apr 11, 2020 7:12 pm
Archimedes wrote:
Sat Apr 11, 2020 3:07 pm
I am an entrepreneur. I make a 7 figure annual income. I built my own successful company.

I don’t enjoy going to the expensive lawyers and accountants all that much. I may get more interesting advice when I post on bogleheads or on a forum in my industry. Sure, I may then bring forward some of those ideas to the expensive professionals, but I still get good ideas and appreciate the discussion right here. I also like to think that I know how to spot good advice and how to ignore bad advice, but no matter what, I quite often benefit from the discussions on this forum.

Please be polite and respect the OP for the question posed. Rich people have feelings too! Go ahead and present a thoughtful answer, or otherwise, you could simply opt to reserve your right to remain silent.
I agree with your comments. But it is logical to expect an extremely high level cognitive abilities of somebody making a $1 million a year. Note that it is very different to be "rich" than to make a $1 million salary. A very uneducated person can become rich by winning the lotto, or one dummy person can become very rich by luckily receiving shares prior to IPO. We are talking here about a corporate salary.

I'd say that most developing countries in the world have no person making a $1 million yearly corporate salary outside of the CEO. At a minimum, I'd expect a person at that level to have extremely sound insight, judgement and decision making skills.
I'm not sure exactly what this means, but are you arguing that asking for advice on an online forum shows evidence of lack of such skills? Why?
Market Timer is clearly one with high level cognitive abilities and this thread doesn't suggest anything different.

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yangtui
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Re: Executive pay cut request: How to respond?

Post by yangtui » Sun Apr 12, 2020 10:52 am

KyleAAA wrote:
Sun Apr 12, 2020 9:45 am
New Providence wrote:
Sat Apr 11, 2020 7:12 pm
Archimedes wrote:
Sat Apr 11, 2020 3:07 pm
I am an entrepreneur. I make a 7 figure annual income. I built my own successful company.

I don’t enjoy going to the expensive lawyers and accountants all that much. I may get more interesting advice when I post on bogleheads or on a forum in my industry. Sure, I may then bring forward some of those ideas to the expensive professionals, but I still get good ideas and appreciate the discussion right here. I also like to think that I know how to spot good advice and how to ignore bad advice, but no matter what, I quite often benefit from the discussions on this forum.

Please be polite and respect the OP for the question posed. Rich people have feelings too! Go ahead and present a thoughtful answer, or otherwise, you could simply opt to reserve your right to remain silent.
I agree with your comments. But it is logical to expect an extremely high level cognitive abilities of somebody making a $1 million a year. Note that it is very different to be "rich" than to make a $1 million salary. A very uneducated person can become rich by winning the lotto, or one dummy person can become very rich by luckily receiving shares prior to IPO. We are talking here about a corporate salary.

I'd say that most developing countries in the world have no person making a $1 million yearly corporate salary outside of the CEO. At a minimum, I'd expect a person at that level to have extremely sound insight, judgement and decision making skills.
I'm not sure exactly what this means, but are you arguing that asking for advice on an online forum shows evidence of lack of such skills? Why?
Yea, I am confused too. The few super smart and financially successful people I have had the luxury of interacting with were constantly asking questions and trying to optimize their decisions/beliefs. This site is an excellent place for people of all economic levels to ask good questions and get relevant answers and insightful insights.

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TomatoTomahto
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Re: Executive pay cut request: How to respond?

Post by TomatoTomahto » Sun Apr 12, 2020 11:04 am

Seasonal wrote:
Sun Apr 12, 2020 5:55 am
New Providence wrote:
Sat Apr 11, 2020 7:12 pm
I agree with your comments. But it is logical to expect an extremely high level cognitive abilities of somebody making a $1 million a year. Note that it is very different to be "rich" than to make a $1 million salary. A very uneducated person can become rich by winning the lotto, or one dummy person can become very rich by luckily receiving shares prior to IPO. We are talking here about a corporate salary.

I'd say that most developing countries in the world have no person making a $1 million yearly corporate salary outside of the CEO. At a minimum, I'd expect a person at that level to have extremely sound insight, judgement and decision making skills.
It may be logical to expect extremely high cognitive abilities, sound insight, judgement and decision making skills from somebody making a $1 million a year. Having dealt with more than a few of such people, it is not true.

On the other hand, if you're paying someone to have these qualities, it is reasonable to expect it.
Yeah, the stories we could tell ... but shouldn’t. ... and so won’t. :D
Okay, I get it; I won't be political or controversial. The Earth is flat.

fullplay2024
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Re: Executive pay cut request: How to respond?

Post by fullplay2024 » Sun Apr 12, 2020 11:34 am

Archimedes wrote:
Sat Apr 11, 2020 3:07 pm
I am an entrepreneur. I make a 7 figure annual income. I built my own successful company.

I don’t enjoy going to the expensive lawyers and accountants all that much. I may get more interesting advice when I post on bogleheads or on a forum in my industry. Sure, I may then bring forward some of those ideas to the expensive professionals, but I still get good ideas and appreciate the discussion right here. I also like to think that I know how to spot good advice and how to ignore bad advice, but no matter what, I quite often benefit from the discussions on this forum.

Please be polite and respect the OP for the question posed. Rich people have feelings too! Go ahead and present a thoughtful answer, or otherwise, you could simply opt to reserve your right to remain silent.
+1

I'm an executive at a small company. You can sometimes pay an expensive lawyer or a coach and still not get advice as sound as you would on bogleheads.

Marketimer - I have personally volunteered for a 50% pay cut due to current crisis. While I wasn't happy about it, I thought it was the right thing to do.
Many CEOs and execs don't have a choice but to show the empathy to relatively underpaid employees who are being furloughed and losing jobs. I would advice you to ramp up your side hobby if you don't have enough work in your day job. Most boards and executives believe in the quote, "adversity reveals true character of leaders". Tread carefully if you don't want to burn bridges or want to stay at your current employer.

Good luck.

toofache32
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Re: Executive pay cut request: How to respond?

Post by toofache32 » Sun Apr 12, 2020 12:12 pm

Watty wrote:
Fri Apr 10, 2020 11:26 pm
market timer wrote:
Fri Apr 10, 2020 10:28 pm
My view is that a 25% pay cut is reasonable due to lower productivity when working from home. I'm happy to agree to that with the understanding that my work week will be 30 hours instead of 40 to account for increased child care with the kids out of school.
You also make enough that you could afford to hire someone to come in and take care of the kids during the day when you are working from home.
How would this work during the pandemic?

Bfwolf
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Re: Executive pay cut request: How to respond?

Post by Bfwolf » Sun Apr 12, 2020 12:31 pm

market timer wrote:
Sat Apr 11, 2020 9:26 pm
Thank you all for the replies. It helps me to understand the different perspectives and complexities involved.

I agree that asking for reduced hours is not a good idea. It is, however, the reality of work-from-home with kids that my attention is divided. I'm going to do what it takes to keep my family together. So, I should rephrase my position that a 25% pay cut is reasonable given the additional family responsibilities.

For a much larger cut, say 50%, I'll ask for a contract amendment, as 8foot7 recommended. A complicating factor of a large pay cut is that I have other options I'd like to pursue, and I'm not sure I'll ever see my target compensation of $700K in the future.
Why would you phrase your position as a reduction in wages is reasonable given your increase in family obligations? Why not phrase it as doing what it takes to help the company survive? The former frames it as a you-centric solution while the latter frames it as a company-centric solution. Even if the former is closer to the truth, wouldn’t the latter framing go over better with your bosses?

dcabler
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Re: Executive pay cut request: How to respond?

Post by dcabler » Sun Apr 12, 2020 12:55 pm

fatFIRE wrote:
Sat Apr 11, 2020 12:46 pm
runner540 wrote:
Sat Apr 11, 2020 7:06 am
+1
I see a lot of companies across industries and sizes doing paycuts, concentrates among management and better paid employees. Be a team player and a leader. Refusing is going to be remembered and not in a good way.
I'm going to be contrarian and say that's bad advice. The company is not going to remember to restore your salary when the tough times are over.

Also, OP is an executive and I'll assume OP is in demand and is "hot stuff". Taking the paycut is doing a disservice to OP's career. OP mentioned $700k could go as low as $200k. That ain't a small bite. If there are better options out there, go for it.

I've always advocated strong career management and be a high-priced mercenary. Make sure your skills are good, you are in demand, you are "hot stuff" with everyone chasing for you. And sell out to the highest bidder.
Not necessarily. I've been in my particular field since 1984. At least 4 times that I recall, during downturns, all exempt employees took salary cuts with execs taking a larger percentage. In each and every case, once the downturn was over, salaries were fully restored and the annual performance review/raise cycle never missed a beat.

bltn
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Re: Executive pay cut request: How to respond?

Post by bltn » Sun Apr 12, 2020 1:40 pm

Talking to the current president of my former small company, the officers are taking 50% payouts in an effort to maintain full employee salaries. If the slowdown lasts more than a couple of additional months, the plan will be to cut employee income by 10 % while the officers may take additional pay reductions. The officers are trying to support the company, believing that they will benefit from these measures in the long run. Doesn't t that concept also apply to large companies?

If I liked my job, I would accept the temporary decrease in pay and decide how to develop my personal project on the side. If you want to leave your job, then this might be a good time to take the severance, assuming this can be accomplished with the positive feelings of your employers. I would have another job option lined up before leaving my current workplace.

If I were able to successfully do my job in 25-30 hours a week, I would spend another 25-30 hours working on my side project. But that s just me.

Grasshopper911
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Re: Executive pay cut request: How to respond?

Post by Grasshopper911 » Sun Apr 12, 2020 1:55 pm

market timer wrote:
Fri Apr 10, 2020 10:28 pm
Many companies are asking executives to take pay cuts in this environment. It is likely I'll be asked to take one, so I would like to respond appropriately. My view is that a 25% pay cut is reasonable due to lower productivity when working from home. I'm happy to agree to that with the understanding that my work week will be 30 hours instead of 40 to account for increased child care with the kids out of school. If asked to take a 50% pay cut, I'd prefer a layoff and severance, as I have a side project I'd like to pursue. Is this a reasonable position to take?
I can relate in one way, such that I’m a highly compensated executive.

I can’t relate to your position/perspective.

We implemented a reduction to all of our employees, with a bigger amount possibly forthcoming.

Our intent is to not lay off anyone.

Our exec team asked for a bigger decrease than the rest of the staff. A 25% cut to someone making $30-$75k per year much more impactful than us taking 50+%.

We did offer all of our folks additional vacation time as some type of positive benefit.

Do I have a employment contract — yes.

Am I willing (asking) to take a cut outside of this agreement with the understanding it will go back to status quo after the storm - yes.

We’re in the manufacturing space. Our business is down, but not devastated.

I truly feel for all of the folks in the service and travel industries.

It’s important the economy not stay idle too much longer or the quarantine will be much more devastating than the virus itself.

For those in a similar position, never forget your journey to the roles you are in now. None of us would be successful without all of the great people you are leading that helped in your success. Lead by example - now more than ever.

softwaregeek
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Re: Executive pay cut request: How to respond?

Post by softwaregeek » Mon Apr 13, 2020 6:13 pm

I did take a pay cut. ( I am VP management at small company). But the CEO and a board member both promised that I would be taken care of in the next round of stock options. For those of us whose pay is primarily variable this means that I will likely come out ahead in the long term. Team players get rewarded.

Normchad
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Re: Executive pay cut request: How to respond?

Post by Normchad » Mon Apr 13, 2020 6:51 pm

softwaregeek wrote:
Mon Apr 13, 2020 6:13 pm
I did take a pay cut. ( I am VP management at small company). But the CEO and a board member both promised that I would be taken care of in the next round of stock options. For those of us whose pay is primarily variable this means that I will likely come out ahead in the long term. Team players get rewarded.
In my experience, you are 100% correct, team players do get rewarded. Or as we say, "if you do more, you get more". I see and read a lot of stuff on here and other places, where people encourage each other to foster an adversarial relationship with their employer. Everybody is free to do what they want, but I can't fathom why people think this would ever be good for them personally.

Somebody will correctly point out that team players don't always get rewarded; thats' probably true. But I'm sure they do better than the jerks.

BV3273
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Re: Executive pay cut request: How to respond?

Post by BV3273 » Mon Apr 13, 2020 8:04 pm

Do you believe in the company? Your boss? Your bosses boss? How have they responded to the pandemic thus far?

I think everyone who is going to get/has gotten/will be getting a pay cut needs to ask themselves these questions and be honest with themselves.

In my eyes this is a time when companies can create “lifers”. A “lifer” is someone who will stay with the company forever because they did the right thing while we are navigating these uncharted waters. On the flip side it can also be a time to see the true colors of your company and executive team/owners.

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Meaty
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Re: Executive pay cut request: How to respond?

Post by Meaty » Mon Apr 13, 2020 8:34 pm

market timer wrote:
Fri Apr 10, 2020 11:39 pm
Watty wrote:
Fri Apr 10, 2020 11:26 pm
It might vary by industry but I unless they were paid hourly few people I have known consistently worked just 40 hours a week.
I tend to organize my schedule so that I don't need to work many hours: clear goals for my teams, clear evaluation metrics, technical guidance, pushing back on management when busy work is assigned, no political jockeying, no gossip, and willingness to make hard decisions proactively. Usually I don't have to work more than 25 hours per week.
Based on the above - you are officially my hero. Do you mind sharing the industry you work in?
"Discipline equals Freedom" - Jocko Willink

fatFIRE
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Re: Executive pay cut request: How to respond?

Post by fatFIRE » Mon Apr 13, 2020 8:55 pm

Normchad wrote:
Mon Apr 13, 2020 6:51 pm
softwaregeek wrote:
Mon Apr 13, 2020 6:13 pm
I did take a pay cut. ( I am VP management at small company). But the CEO and a board member both promised that I would be taken care of in the next round of stock options. For those of us whose pay is primarily variable this means that I will likely come out ahead in the long term. Team players get rewarded.
In my experience, you are 100% correct, team players do get rewarded. Or as we say, "if you do more, you get more". I see and read a lot of stuff on here and other places, where people encourage each other to foster an adversarial relationship with their employer. Everybody is free to do what they want, but I can't fathom why people think this would ever be good for them personally.

Somebody will correctly point out that team players don't always get rewarded; thats' probably true. But I'm sure they do better than the jerks.
Nobody is advocating OP to be a jerk, unless you consider looking out for yourself to be a jerk. And as for "adversarial relationship" to the employer...
BV3273 wrote:
Mon Apr 13, 2020 8:04 pm
Do you believe in the company? Your boss? Your bosses boss? How have they responded to the pandemic thus far?

I think everyone who is going to get/has gotten/will be getting a pay cut needs to ask themselves these questions and be honest with themselves.

In my eyes this is a time when companies can create “lifers”. A “lifer” is someone who will stay with the company forever because they did the right thing while we are navigating these uncharted waters. On the flip side it can also be a time to see the true colors of your company and executive team/owners.
I think you might be living the in the 1960s where employee loyalty means something. Megacorps will dump you like a rock the moment they need too. So it's not forming an 'adversarial relationship' with the employer, it's just how things are. At least OP will get a legally enforceable golden parachute, whereas the rank-and-file gets nothing.

Best way to manage career is align your interest with your company's interest. If that diverges too much, it's time to go. Your employer will not reward loyalty, why would they? In fact, the best employees are those that hop from company to company because they are continuously being poached.

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Re: Executive pay cut request: How to respond?

Post by Jags4186 » Mon Apr 13, 2020 9:13 pm

Normchad wrote:
Mon Apr 13, 2020 6:51 pm
softwaregeek wrote:
Mon Apr 13, 2020 6:13 pm
I did take a pay cut. ( I am VP management at small company). But the CEO and a board member both promised that I would be taken care of in the next round of stock options. For those of us whose pay is primarily variable this means that I will likely come out ahead in the long term. Team players get rewarded.
In my experience, you are 100% correct, team players do get rewarded. Or as we say, "if you do more, you get more". I see and read a lot of stuff on here and other places, where people encourage each other to foster an adversarial relationship with their employer. Everybody is free to do what they want, but I can't fathom why people think this would ever be good for them personally.

Somebody will correctly point out that team players don't always get rewarded; thats' probably true. But I'm sure they do better than the jerks.
You are rewarded for results not being a team player. I've seen many team players and nice guys/gals unceremoniously dumped by their company.

Being a team player/nice guy may save your job over a jerk's with equal performance. But a team player will be dumped before a somewhat difficult high performer is dumped any day of the weak.

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Re: Executive pay cut request: How to respond?

Post by Nowizard » Mon Apr 13, 2020 9:27 pm

Difficult to respond since many here have not been in such highly compensated positions. If you want to stay with the company, then to be a team player would benefit you if you were in companies with which I am familiar. It does seem there are posters who feel your request is reasonable, but it is very difficult to integrate that you want to both retain the highest level of pay possible and are considering another possibility at the same time. It would be difficult to feel comfortable with a highly paid employee presenting the approach presented. It may be that the true opportunity is the other possibility you are considering over a future with your current company.

Tim
Last edited by Nowizard on Mon Apr 13, 2020 9:34 pm, edited 1 time in total.

Normchad
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Re: Executive pay cut request: How to respond?

Post by Normchad » Mon Apr 13, 2020 9:33 pm

This is all off-topic to this thread; I was actually thinking about a different thread when I wrote the original post.

I agree results matter. But so does fitting in, and being somebody that others can work with. I'm not saying anything differently. However, I can't think of any case in which it is advantageous to the employee to be adversarial.

I also agree that everybody should be looking out for #1. Everybody has plenty of time to do that away from work. And if you find a better situation, you should absolutely take it.

I also think there are an awful lot of people that greatly overestimate their value to their company, (Not in this case of OP though). So when I see threads about the unemployed 45 year old developer that can't find a new job, and whines about ageism; I wonder what they were like to work with. All other things being equal, if they were a good team player, I would think there would be somebody from their past that would throw them a lifeline. And even if you are that truly amazing, your boss is probably average, and might still fire you if you irritate them.

So my advice to everybody. When at work, be a team player; don't be a jerk. Try to make your boss successful. Align your efforts with the goals of the business you are in. That's what you're being paid to do, and you should do it. But away from work, absolutely be thinking about what is next for you. And what is best for you. Sometimes what is best for you, is getting better at the job you already have; and sometimes it's to find a new job, Take classes online; teach classes; go to trade shows, and absolutely go to job interviews once in a while.

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Re: Executive pay cut request: How to respond?

Post by AlphaLess » Mon Apr 13, 2020 9:35 pm

Normchad wrote:
Fri Apr 10, 2020 10:33 pm
Something I've never understood is, why do companies ever give severance? As a steely eyed capitalist, when times are tough and people need to get laid off, where do the companies suddenly find the money to pay severances?
Several reasons:
- if companies did not give severances, employees would ask for higher pay,
- severance usually comes with employees signature not to sue,
- if employees were not given severances, morale would go down among those who are left.

As a steely eyed capitalist, I think companies are exploiting employees more than they should.
"A Republic, if you can keep it". Benjamin Franklin. 1787. | Party affiliation: Vanguard. Religion: low-cost investing.

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Re: Executive pay cut request: How to respond?

Post by dmcmahon » Mon Apr 13, 2020 10:00 pm

If I were committed to the organization longer term I would take one for the team, with the understanding that my pay would be restored when things normalized. I'd certainly do that for my current employer if it were necessary. If you're not committed long term, well, sometimes taking one for the team means taking the severance package and exiting to leave more room for younger people who need the jobs more than you do. Ultimately you still have a responsibility to your own family and you have to balance their best interests against those of the organization too. Best of luck, MT, whatever you decide.

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market timer
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Re: Executive pay cut request: How to respond?

Post by market timer » Mon Apr 13, 2020 10:39 pm

Meaty wrote:
Mon Apr 13, 2020 8:34 pm
market timer wrote:
Fri Apr 10, 2020 11:39 pm
Watty wrote:
Fri Apr 10, 2020 11:26 pm
It might vary by industry but I unless they were paid hourly few people I have known consistently worked just 40 hours a week.
I tend to organize my schedule so that I don't need to work many hours: clear goals for my teams, clear evaluation metrics, technical guidance, pushing back on management when busy work is assigned, no political jockeying, no gossip, and willingness to make hard decisions proactively. Usually I don't have to work more than 25 hours per week.
Based on the above - you are officially my hero. Do you mind sharing the industry you work in?
I am not tied to a specific industry or functional domain. My main skill is making general management a more scientific process. I've found that toxic environments usually result from poorly defined goals and processes.

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gr7070
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Re: Executive pay cut request: How to respond?

Post by gr7070 » Mon Apr 13, 2020 11:07 pm

AlphaLess wrote:
Mon Apr 13, 2020 9:35 pm
Several reasons:
1 if companies did not give severances, employees would ask for higher pay,
2 severance usually comes with employees signature not to sue,
3 if employees were not given severances, morale would go down among those who are left.
I suspect the biggest reason is to compete for employees. If their direct competition doesn't they aren't either.

In my industry and location companies typically give 0-2 weeks. No reason to give more if few/no others do.

I doubt any of your reasons are a factor in my situation.

1. I doubt this leads to higher pay; I work in probably the lowest paying engineering field. Ultimately competition is what drivers pay.

2. Maybe; never heard of one person in my industry signing anything. I also work in an at will state.

3. I highly doubt morale in my location and industry differs much from others.

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Re: Executive pay cut request: How to respond?

Post by softwaregeek » Tue Apr 14, 2020 12:25 am

fatFIRE wrote:
Mon Apr 13, 2020 8:55 pm


I think you might be living the in the 1960s where employee loyalty means something. Megacorps will dump you like a rock the moment they need too. So it's not forming an 'adversarial relationship' with the employer, it's just how things are. At least OP will get a legally enforceable golden parachute, whereas the rank-and-file gets nothing.

Best way to manage career is align your interest with your company's interest. If that diverges too much, it's time to go. Your employer will not reward loyalty, why would they? In fact, the best employees are those that hop from company to company because they are continuously being poached.
My circle, of startup executives and VC's in Silicon Valley is very small and reputation driven. It isn't the "employer" you have to impress, it's those around you. Case in point: After CEO of current company provisionally offered me the job (we had worked together at a previous company for a couple of years) he invited me to interview with the venture capitalists behind the company. And the first question was "Do you know X? You must have worked with him. " And I responded that I knew him and that he was free to call for a reference. And the venture capitalist smiled and said "Of course I will." Because at a certain level, it's about reputation and trust.

Those ahead of you are your mentors and your sherpas. And your direct reports are your future as you move up the ladder. You've all seen the situation where a manager gets replaced, and the new manager brings in their entire team. For us, the ability to bring the prebuilt, high performance team is part of what we are paid for. Because there are plenty of high performers who can't recruit and lead. And that means both being a team player for those above and taking care of your team below.

/rant

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market timer
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Re: Executive pay cut request: How to respond?

Post by market timer » Tue Apr 14, 2020 12:28 am

softwaregeek wrote:
Tue Apr 14, 2020 12:25 am
For us, the ability to bring the prebuilt, high performance team is part of what we are paid for.
Are you not prevented from doing this by non-solicitation clauses in your contract?

softwaregeek
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Re: Executive pay cut request: How to respond?

Post by softwaregeek » Tue Apr 14, 2020 12:35 am

market timer wrote:
Tue Apr 14, 2020 12:28 am
softwaregeek wrote:
Tue Apr 14, 2020 12:25 am
For us, the ability to bring the prebuilt, high performance team is part of what we are paid for.
Are you not prevented from doing this by non-solicitation clauses in your contract?
Non competes are forbidden in California. And while I am forbidden to solicit people, they can solicit me. And that's the way it works. I just put up a post on LinkedIn. And people contact me to see if it's interesting. I literally don't need to solicit people because the things I get up to are interesting and I take care of my people. That means getting them the opportunity to do higher level things, to be recognized, to teach them new skills, to get my performers rewarded financially. And the people who have worked for me get accelerated up the ladder and are in high demand from competitors.

kiwi123
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Re: Executive pay cut request: How to respond?

Post by kiwi123 » Tue Apr 14, 2020 4:33 am

For someone that makes $700k with an employment contract it seems like you should have your personal attorney/lawyer available to advise you on how best to play this situation... i'm assuming that you had your own lawyer review your employment contract before you signed it? And you should be able to afford $250-$500 for an hour consult... or you could ask the internet :-)

fatFIRE
Posts: 346
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Re: Executive pay cut request: How to respond?

Post by fatFIRE » Tue Apr 14, 2020 5:14 am

softwaregeek wrote:
Tue Apr 14, 2020 12:25 am
fatFIRE wrote:
Mon Apr 13, 2020 8:55 pm


I think you might be living the in the 1960s where employee loyalty means something. Megacorps will dump you like a rock the moment they need too. So it's not forming an 'adversarial relationship' with the employer, it's just how things are. At least OP will get a legally enforceable golden parachute, whereas the rank-and-file gets nothing.

Best way to manage career is align your interest with your company's interest. If that diverges too much, it's time to go. Your employer will not reward loyalty, why would they? In fact, the best employees are those that hop from company to company because they are continuously being poached.
My circle, of startup executives and VC's in Silicon Valley is very small and reputation driven. It isn't the "employer" you have to impress, it's those around you. Case in point: After CEO of current company provisionally offered me the job (we had worked together at a previous company for a couple of years) he invited me to interview with the venture capitalists behind the company. And the first question was "Do you know X? You must have worked with him. " And I responded that I knew him and that he was free to call for a reference. And the venture capitalist smiled and said "Of course I will." Because at a certain level, it's about reputation and trust.

Those ahead of you are your mentors and your sherpas. And your direct reports are your future as you move up the ladder. You've all seen the situation where a manager gets replaced, and the new manager brings in their entire team. For us, the ability to bring the prebuilt, high performance team is part of what we are paid for. Because there are plenty of high performers who can't recruit and lead. And that means both being a team player for those above and taking care of your team below.

/rant
I mostly do not disagree with you, except that the employer is not equals to your team. Your team changes, and you can move with your team.

You're talking about an old boys club. That's totally different from a soulless megacorp. Megacorp hiring standards are also less easy to game. Unless you're a very high-level person or have strong reputation in the field, you can't get into a top megacorp just by knowing people. I suppose if you're not in a technical field or a manager, then yes it's easier to just "smoke" your way through the interviews. In some places like Google, the team interviewing you is not the team you will be working for. Very famous and reputed programmers have been rejected by Google because they can't pass the interview.

Also, if you're looking to take care of your team, you wouldn't do a 50% pay cut.

KNMLHD
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Re: Executive pay cut request: How to respond?

Post by KNMLHD » Tue Apr 14, 2020 6:21 am

market timer - Is there a third option? Some added form of equity (options/RSUs/etc) that pays out in the future to offset current, temporary salary reduction? You could present that as an alternative to severance if asked to take 50% pay cut.

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