An anonymous Cabinet minister has made headlines in the Daily Mail for suggesting that civil servants who insist on working from home should get their pay cut.
“People who have been working from home aren’t paying their commuting costs, so they have had a de facto pay rise, so that is unfair on those who are going into work. If people aren’t going into work, they don’t deserve the terms and conditions they get if they are going into work.”
So, can you cut pay for your home workers? It may seem logical, especially with the rising price of fuel for those who are still commuting. But don’t move too fast–you need to consider the employee’s duties and their hours.
If someone is working from home (or even working on a hybrid basis) permanently, but their role is still the same as when they were office-based. It’s inadvisable to pay them less, unless they agree to it or unless their employment contract specifically allows for it. Cutting pay due to a change of workplace can be classed as unlawful deduction from wages if they are:
- Working the same number of hours
- Doing the same amount of work
- Under the same obligations
Even if the employee agrees to a pay cut, you could face a claim for indirect sex discrimination if it can be demonstrated that more women in your company work from home than men. You could also be liable for constructive dismissal if you cut an employee’s pay without justification and they’re forced to resign as a result.
Check your employees’ contracts before you make any changes. For example, can you reduce or remove London weighting for someone who used to commute to your London office from outside the city but is now working from home? Perhaps, if their contract allows for lower pay for those living outside London–but even then, be careful.
If you normally pay staff based outside London the same as those in London, it’s inadvisable to cut pay. Again, you could face claims of constructive dismissal, discrimination (especially if this affects one gender more than another), or breach of contract.
On a related note, think about any contractual perks you provide that have a financial value. If you’re providing these to office workers but removing them for home workers, you might want to consider offering some compensation to your home workers.
In short–trying to claw back that saving on the commute is probably the opposite of worth it.