Ask HR: Is This Demotion Allowed?
Ask HR: Is This Demotion Allowed?

Ask HR: Is This Demotion Allowed?

Just when you think you’ve heard it all, one of your employees stumps you with a question you haven’t heard before. The pros at the HR Support Center really have heard it all—at least, until tomorrow.

Here is a recent question from a real HR professional, and the expert advice given by HR On-Demand, one of the features available to HR Support Center subscribers.

Question: A recently hired employee has the skill set to perform most but not all of the duties he was hired to do. Can we demote him to a different position and reduce his compensation?

Answer: Yes. As long as the employee does not have a written employment contract guaranteeing him a certain position or rate of pay, you may reduce his pay and transfer him to a position for which you feel he is better qualified.

Before taking this step, you should consider the pros and cons of changing his role. It is common for an employee to not entirely meet the ideal outlined in the job description. Remember that you put time and money into hiring him for that position and he accepted your offer for this particular title and rate of pay. With that in mind, are the skills he’s missing something he can learn through training? Is a new hire likely to have all the skills you’re looking for? Would the demotion hurt overall employee morale? If his role is changed, would he likely leave the company, and, if so, would the company suffer an appreciable loss?

However you answer these questions, we recommend that you document the employee’s substandard performance, skill gaps, knowledge deficits and any measures you took to address these matters. If you do decide to transfer him, this documentation may prove helpful if you are ever challenged on the decision.

Should you choose to change his role, you should meet with the employee, along with a third-party witness, to explain the changes and provide him with a new offer letter delineating the new terms of employment. Be sure to mention any previous coaching and any warnings the employee received. While not required, advance notice of a decrease in pay would help you to maintain a good rapport with the employee. Calling the move a “transfer” instead of a “demotion” might help as well.

As with any employment matter, you should apply your policies consistently. If you have any other under-performing employees in similar positions, you should take the same course with them. Not doing so could open you up to charges of discrimination or retaliation.

Answered by HR Pro Sarah, who has extensive HR experience in the legal, software, security and property preservation industries. Sarah has a Business Communications degree from Villa Julie College (now Stevenson University) and a master’s certificate in Human Resources Management and a Strategic Organizational Leadership certification from Villa Nova University. Sarah is also a member of the National Society of Human Resources Management and has managed the HR function for small startup companies to mid-sized/large organizations.

_This Q&A content is taken straight from the experts at HR Support Center. Click here to learn more about HR Support Center and HR On-Demand; we’d also love the chance to explain in person

More to Discover

EEO-1 Reporting Deadline For 2019

EEO-1 Reporting Deadline For 2019

For more than five decades, employers were required to submit the EEO-1 report by September 30 of each year. In 2018, that date changed to March 31. And this year, many employers were preparing to meet that deadline. But on February 1, 2019, the Equal Employment Opportunity Commission (EEOC) notified all employers of an extension. The deadline to submit EEO-1 data was moved to May 31, 2019. Why the Extension to File the EEO-1 Report? Like many other federal agencies, the EEOC was impacted by the government shutdown. With resources stretched thin, the agency was unable to open the EEO-1 filing website as planned in January. As a result of the delay, employers were granted a two-month extension to continue gathering necessary data to...

Jacksonville Jumbo Shrimp Case Study

Jacksonville Jumbo Shrimp Case Study

Needing a more efficient solution to manage time worked for their seasonal and part-time staff, the Jacksonville Jumbo Shrimp turned to Paycor for help. Discover how Paycor’s robust Perform Time solution drastically improved how the ball club tracks and reports on hours worked.

How to Find the Perfect HR Payroll Systems: Top 10 Things to Look For

How to Find the Perfect HR Payroll Systems: Top 10 Things to Look For

HR teams spend nearly 70% of their time on inefficient administrative tasks, some of which are still paper-based. As a business grows and takes on new employees, HR professionals may find the need to expand their payroll system to something more robust in order to address the needs of all employees. Having an integrated HRIS solution provides more efficiency because information only has to be entered once, and it improves accuracy across all databases. It also helps improve employee engagement by providing learning opportunities and lines of communication. Why Do I Need an HRIS Solution? In short, an HRIS (human resource information system) solution saves you money and time. Also known as human capital management (HCM) or a human...

HR

LJ Ross Case Study

LJ Ross Case Study

Needing a more efficient way to manage hours and track incidents, LJ Ross turned to Paycor. Now, with Perform Time, supervisors are no longer burdened with reviewing time cards and managing attendance policies by hand. Download the case study to learn more.