Ministry of Human Resources further advised that companies can reduce salary under article 41 if the hours are also reduced. This update is related to the 40% salary cut permission by Ministry. More details below:
Ministry advice companies to reduce hours as salary cut condition
Salary reduction is depending on the hours reduced. Companies will need to work with the mechanism of range salary reduction. This means the range of reduction between 1-40% but depending on hours reduced. Individual contracts can be terminated but for employees with reduced hours or exception leaves. However, there are further three conditions related to this.
- Six Months must be completed as reduced hours.
- Reduction of Wages as part of the measures, this can be exception leave, full or part-time leave.
- The employer must not take advantage of any Grant or Benefits of the Government and then decide to terminate the contract.
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