Many contractors are experiencing a lower dollar volume of business. That means less money coming in the door to pay overhead, so the smart contractors have cut back on overhead spending.

If you are in that boat, have you prepared your employees for the fact that bonuses (if any) may be reduced or completely eliminated this year? You can’t do less business and still have money to dole out bonuses, picnics, Christmas parties, etc. They may not like it, but this is about business, not employees (or owner’s) likes or dislikes. Sometimes survival is more important, and if your business doesn’t survive, there won’t be any jobs, either. If money is tighter this year, you can’t provide things that you have in the past.

Be very careful, gang. Check with your attorney if you decide to cut back on a benefit that you have provided in the past. An unhappy employee can file a grievance with your state employment board and cause you some serious problems if you don’t handle it correctly.

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Frank Yeager
Frank Yeager
August 31, 2008 2:32 pm

I’ve been on both sides of this issue and I wonder at the people who decide to drop insurance coverage for their employees. There are alternatives. Insurance is just like any other service, if you don’t like the price you can and should negotiate a better one or take your money somewhere else. What’s most important is to keep up communication with employees about the issue. The more informed they are, the more help they can be in solving the problem without dropping insurance coverage altogether. The first thing to do is discuss your coverage with your agent/broker. It’s possible… Read more »

Rhonda Burgin
Rhonda Burgin
August 27, 2008 12:55 am

We have had to have our employees choose to pay for 50% of their health insurance or no insurance at all. We have paid 100% of the health insurance when things were really good, Health Insurance goes up every year and we just can’t afford it anymore.

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