July 23, 2020
Does a wage reduction in excess of 25% for hourly employees mean the hourly wage is increased by more than 25%?
Posted by Armanino Financial Advisory Team
As it happens, “reductions” are the diametric opposite of “increases”. A wage reduction in excess of 25% means that the employee was paid at a rate that was less than 75% of what their hourly wage had been previously. That means their pay went down. Conversely, if their hourly wage was increased by more than 25%, that means their pay went up. Since what we are talking about here is the Salary Reduction Factor, we only want to focus on people who had a reduction. There is no Salary Increase Factor that you have to calculate for forgiveness, though any such employees would likely be happier.