Doesn’t the law provide for a salary cut cap?

Friday June 19 2020


By Moses Ssesanga

Dear Moses,
Do employers expect salaries to keep going down? The rate at which they’re chopping money is scary. Some companies are paying workers 50 percent. Doesn’t the law provide for a salary cutting cap which employers are not supposed to exceed? Ben

Dear Ben,
Businesses and all enterprises, the world over, irrespective of size (SMEs or Corporates) have been brutally traumatised by the Covid-19 pandemic. Many businesses have overnight lost their main revenue streams estimated in billions of dollars. As a result, some businesses have had no option but to close shop completely while others, although limping, have taken drastic measures including, chopping staff salaries and allowances or even laying off employees thereby negatively impacting many dependant lives in the process.

The companies that have managed to maintain their employees earnings intact are drawing mostly from their cash reserves, or they have re-aligned their production lines to producing stuff that’s in high demand like masks, sanitisers, personal protection equipment (PPEs), etc. However, for businesses whose revenue streams have in some instances disappeared or dwindled to trickle, employee earnings protection is definitely not sustainable in the longer term. A key lesson to pick from this, is that employment or a business venture, is like human life. It can be lost at any time. It’s never permanent. The law only serves to guide how employee’s services are terminated but doesn’t guarantee or compel an employer to keep jobs open when the revenues have made a disappearing act.

The law doesn’t spell out ceilings for salary cuts. It only guides that the employee’s consent is a requirement. Therefore Ben, the lesson from this pandemic is that no matter your current skill, job, profession or trade, employed or not, learning different sets of skills beyond your job descriptions is an innovative personal investment that can give you bargaining powers to determine and sustain your earning abilities in this volatile world. Dr Spencer Johnson in his book: “Who Moved My Cheese” says “Sometimes, things change and they are never the same again.”

This COVID -19 period looks like one of those times. Life moves on and unfortunately, today, there’s only one way to remain relevant in a post-COVID19 reality, ie, committing to data literacy, creative thinking, and a lifetime of learning and upskilling. Embrace this new normal with optimism and you will like the new you.

Moses Ssesanga,
Head of Human Resource,
NMG Uganda