Since last year, there were lingering rumors that HR was hatching some plans to adjust our variable specialist allowances but we thought that the most drastic move that they would resort would be to incorporate the variable component into our basic pay. We never expect in our wildest dream that they would remove all our allowances. For many of us, the amount is a huge amount and make up at least 30% of our pay. So obviously we were very unhappy. The only consolation news was that the organization would remove the allowances in three years phases, so that affected staff would have time to adjust their personal finances.
This variable adjustable component was indicated in our salary contracts but the HR director insisted that the term “variable” means that the amount can be zero as well, subjected to individual performance and market condition. When he made that kind of statement, all my trust in the organization immediately flushed down the drain. I guess he missed the point on the contractual agreement. Employee is the most important asset of every organization and having trust is important. So even if you don’t wish to honor your agreement, the minimum you should do is to engage your staff and explain clearly the rationale before you made such drastic move. If you can communicate effectively, then the staff would accept the pay cuts even if the quantum is substantial, like in this case. Otherwise, there would be mistrusts, anger, frustration and anxiety among staff.
During the meeting, the HR Director was evasive and refused to give specific details on how we would not be “worse off” with the removal of this variable allowances because they would introduce some kind of mechanism to replace this loss. However, he would not elaborate on the specifics. Instead he pointed out that our salaries were already very competitive and that there would be a pay adjustment coming soon. But obviously he was trying to hook-wink us because this pay adjustment is across the board but we are talking about the removal of our specialist allowances which affected only the forty of us. I felt that in the absence of union in our organization, we were bullied by the HR.
The HR director bragged that the organization is generous enough to give us one year of grace period to adjust our financial commitments. And then, they would start to draw down this allowances within three years. When we pressed for more clarity, he said the details were not firmed up yet. He also keep emphasizing that our salaries are very competitive compared to the industry and they had to resort to this pay cut because they alluded that there was a mistake in their calculation of our pay packages. This really made my blood boils. In my opinion, the person who is overpaid is himself and not us.
This episode only served to instil in me the importance of minding my own business. Why let others control your income and set how your allowances, annual increments and promotion increments? In any case, I don’t trust this organization anymore and would only do the bare minimum required of me. However, I would still stay in this organization until the right time has come for me to leave.
SG Wealth Builder