FAQs on labor cost cutting strategies

FAQs on labor cost cutting strategies

Answers to questions regarding furloughs, pay cuts, trading pay for time, benefits reductions, unemployment, and more — and how the new stimulus package fits in.

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We are amidst one of the most uncertain moments of all time, certainly several decades. And small businesses are some of the hardest hit.

With social distancing rules and shelter-in-place regulations, many business owners are being forced to reduce their workforce through layoffs, furloughs, or by other means — in order to keep enough cash flow to survive.

We’ve compiled a list of frequently asked questions by employers, including:

  • How can I save labor costs during a recession?
  • What are furloughs, and how can I use them?
  • How does the recent $2 trillion stimulus bill address furloughed workers?
  • What are layoffs?
  • Should I use layoffs or furloughs?
  • Are pay cuts legal?
  • How do you issue a pay cut?
  • Can I reduce my employer contributions to benefits?
  • Are my employees eligible for Unemployment Insurance (UI) if I reduce their hours?
  • Can I move salaried, exempt employees to hourly workers?
  • Can I trade time off for less pay with workers?
  • What is a hiring freeze?
  • Can I ask my staff to volunteer?


If you have additional questions, please write to [email protected]