Check Stub Generator is easing the task of paycheck making to a great extent. However, it seems an extremely difficult task to deal with pay cuts. They are really disappointed during this pandemic as the global economy is at stake. Job losses and salary cuts took place worldwide & the US is not an exception.
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Let’s see how to deal with critical situations.
Salaried Individuals are classified into 3 Categories
According to the monthly earnings & expenses, salaried employees are categorized as follows:
- Individuals continuing to pay for expenses, including EMI on Loans, and investments regularly
- Individuals who somehow manage expenses but are less likely to invest
- Salaried employees who barely manage to meet ends with the pay they receive
The employees who fall into the first category are less likely to get affected by the economic crisis laid by the pandemic. But, the ones who fall under the 2nd and 3rd are much affected by the crisis and may face difficult times when their income sources are closed.
Assess the possibilities of a Pay Cut
It’s very crucial to stay up to date with the possibilities of the pay cut. The firm might not be willing to chop you off the employee list but the drain on resources may force them to cut your payments temporarily.
You are free to ask your firm if they have any such plans for your pay. Some firms may ask for feedback from their employees so that they can know the basic pay their employees is willing to receive instead of a random pay decrease.
Pause Investments Temporarily
It might be an issue if you don’t pay your monthly EMIs on time but it would cause no harm if you pause investments temporarily. Maybe the only loss you would suffer is fewer returns later but your capital will be secured anyways.
Give Priority to Short-term Goals
You may have money with you but you might not be interested to invest it currently. It may be sufficient to carry out daily expenses and hence near-term goals seem to be more important right now. As things get back to normal, you may have long-term plans.
Also, it’s a great time to analyze your expenses thoroughly, identify & eliminate unnecessary expenditures & focus on the essentials first.
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Using free paystub maker, you can manage payroll not just during the COVID-19 period but every single day. It’s great if you’re already using this tool but if this is the first time you’re planning to use then don’t delay. Go for it now!
Related Article: 7 Common Small Business Payroll Mistakes & Ways to avoid them
What should I do if I am told I will receive a pay cut during the COVID-19 lockdown?
It is important first to understand the reasoning behind the pay cut and the financial situation of your employer. Consider discussing the situation with your employer or HR representative to determine if there are alternative solutions, such as reducing work hours or implementing other cost-saving measures. You may also want to review your budget and financial priorities to adjust to the reduced income.
Are employers allowed to implement pay cuts during the COVID-19 lockdown?
Employers may be allowed to implement pay cuts during the COVID-19 lockdown if they face financial difficulties or are required to reduce their workforce. However, they must comply with applicable labor laws and regulations, such as providing proper notice and consulting with affected employees or labor representatives.
Can I apply for government assistance if I receive a pay cut during the COVID-19 lockdown?
Depending on your circumstances and country, you may be eligible for government assistance programs, such as unemployment benefits or stimulus payments. It is important to review these programs' eligibility requirements and application process to determine if they may be an option for you.