In 2009 and 2010, around one-third of all pay awards resulted in a pay freeze for at least some employees. This is considerably higher than the long-term average, which stands at around 5% of all pay reviews resulting in a pay freeze.
There are certain steps that employees considering a pay freeze should follow, and XpertHR’s new guide on How to implement a pay freeze takes employers through these:
- Check whether employees are entitled to a pay rise, rather than just a pay review.
- Look at the alternatives to an across-the-board pay freeze – such as limiting it to employees above a certain grade or salary.
- Consider the impact on employee engagement from freezing pay.
- Take care of the legal issues.
- Notify employees.
For more general guidance on the pay review process, see How to conduct a pay review.