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

HR

Federal Tax Deposit 101: Everything Employers Must Know

Federal Tax Deposit 101: Everything Employers Must Know

What is a Federal Tax Deposit? Most would agree that taxes is not an exciting topic. But a full understanding of the rules around taxes is absolutely essential for employers. It’s a major responsibility to manage employees and follow the requirements of withholding taxes from employee wages.The IRS has specific and strict guidelines around withheld taxes. Any withheld taxes must be deposited to the IRS in the appropriate manner. This process is called the federal tax deposit.In this guide, we’ll outline the important aspects of payroll processing and the federal tax deposit.Before we dig into the federal tax deposit, these are the important areas within employee taxes and payroll. Paycheck calculation and preparation Withholding taxes...

Webinar: How Paycor Can Take Blackbaud's Payroll 7 Clients To The Next Level - 1/16/20 @2pm ET

Webinar: How Paycor Can Take Blackbaud's Payroll 7 Clients To The Next Level - 1/16/20 @2pm ET

Blackbaud’s Payroll clients have been asking for a more robust payroll offering and we’re excited to announce a new partnership between Blackbaud and Paycor.An industry-leading HR and payroll provider with nearly 30 years of experience serving small to medium-sized businesses, Paycor will not only deliver more robust payroll functionality, but also a suite of products and services to help Blackbaud clients better serve their mission.Join us on January 16th as Paycor Senior Vice President, Rick Chouteau, and Blackbaud Partner Development Leader, Craig Suppin, showcase why Paycor can be chosen to replace the Payroll 7 module, helping your organization improve operational efficiencies while reducing risk.In this webinar, we’ll share: • A...

Leap Year Payroll: How to Handle 27 Pay Periods

Leap Year Payroll: How to Handle 27 Pay Periods

If you pay employees bi-weekly, you normally have 26 pay periods a year. But 2020 brings you an extra one—thanks, leap year. True, an extra pay period isn’t exclusive to leap years, sometimes it just depends on which day of the week you pay your employees. But regardless of when it occurs, it can cause headaches for HR and payroll administrators who aren’t prepared.There are a few ways to approach a 27-pay-period year, but the most important thing is to communicate your plan to your workforce. Make sure they understand what to expect so there aren’t any surprises surrounding their paychecks. How to Pay Employees During a Year with 27 Pay Periods Option 1: Everyone gets an extra paycheck. Woo-hoo! The extra paycheck would be for the same...

Case Study: Rochester University

Case Study: Rochester University

Michigan based Rochester University relied on their own payroll processing for nearly 60 years. But when their payroll administrator decided to retire, they turned to Paycor to help them save time and resources. “In the three years we’ve been a Paycor customer, I’ve never had a problem reaching my dedicated support team. If I have an emergency, I know I can trust Paycor.” – Ginny May, Director of HR With Paycor, Rochester University has significantly transformed how they manage HR and process payroll with Paycor Time, Paycor’s Mobile App and ACA filing. By eliminating manual work, their staff has more time to focus on strategic initiatives like finding the right faculty members, motivating employees and creating better experiences for...