How to Handle a Demotion and Pay Cut

US News

There's a hidden blessing in being fired. At least then when you receive the bad news you have the opportunity to pack your things, go home and lick your wounds. But there's something so ... awkward about being demoted. It's like that boyfriend who doesn't dump you, he just only wants to see you one day a week instead of the usual three; you're expected to leave your boss's office, bruised, and pick up working through your shame. And bonus -- your duties have been "restructured," so your salary will be also.

Your first impulse of what to do in this situation might not be the best course. Instead, follow this blueprint.

Listen carefully. Does the phrase, "we're going to have to demote you" seem odd? It should -- because it's seldom said. As a result, a lot of employees don't realize they're getting the shaft in the moment it happens. You're more likely to hear diplomatic statements like, "we want to make your responsibilities more manageable," "we want to ensure you aren't stretched thin" and "Johnny loved the work you did on XYZ project, and so you're going to be moved so you can work with him more directly." That language is the signal your boss is letting you down -- and moving you down -- easy.

[See: 10 Things to Do Immediately After Being Fired .]

Take stock. It's natural to feel blindsided if you're demoted, but think back to a few weeks or months before you received word. If the shift is performance-related, a good manager probably gave warning. "If during your check-ins your boss expresses concerns about your performance when he or she never did before, that's a definite red flag," says Hallie Crawford, certified career coach and founder of the Atlanta-based coaching firm Create Your Career Path. "Also listen out for questions like, 'How do you think things are going?' That could be your boss's lead-in to expressing concern."

A less communicative? boss also leaves a trail of clues, Crawford says. "If you're being left out of decisions you'd usually make or meetings you'd usually attend, that's definitely a sign."

Don't take it personal. It stings, but a demotion isn't always a reflection of skill. Maybe you were bumped up to management because of your good work, but now you're being bumped back down? because managing people isn't your forte. Crawford encourages you to stay calm, no matter the reason for the blow, and instead see it as a chance to reassess. "The silver lining is that it will cause more open communication between you and your manager about your role with the company and it's direction," she says. "This could mean the chance to change your job's focus the way you've been wanting to."

[See: 12 Scary Signs Your Company Is In Trouble .]

Also have perspective. "People mistake a good career as one that has a constant upward trajectory," says Penelope Trunk, CEO and founder of Quistic, a website for building career skills. "But that's obviously not what happens in most of our careers -- otherwise we'd all run to be President of the United States. Most of us aren't VPs at Fortune 500 companies." Trunk says that by age 35, lateral changes become more of the norm. Slight downshifts in responsibilities -- particularly when moving from one company to another -- aren't unheard of either.

Understand what's really happening. Having underlying knowledge of what's going on in your industry, at your company and with your department will help you better process how you should feel about a demotion and/or pay cut. For instance, if your pay is lowered but your responsibilities remain the same, this is almost always the result of a strained budget. "Startups cut salaries all the time, and the employees choose to stay on," Trunk says. "Some companies are renowned for telling their staff that they'll have to take a pay cut if they don't want to see some of their colleagues let go."

Or maybe your boss is a little, ahem, inept, and he or she let you start at a salary way north of what's reasonable for your position or experience. A more judicious manager might come in later and try to normalize your pay. "That's unfortunate to have to accept a pay cut for that reason, but it does happen," Crawford says. "If you know that you're making more than the industry standard, then you know it's a situation that is beyond your power to change or control."

[Read: The Psychology of Being Fired .]

Request the bad news in writing. It becomes hard to concentrate after you're dealt a whopper like this, so you're bound to miss everything else your boss says. Request to receive the decision in writing. This is especially necessary if your job responsibilities have changed, so that both you and your boss have a clear understanding of what's now expected from you. Plus, Crawford says "it gives you time to process what's happened, and come back and ask further questions if necessary. You want to have tangible reasons for what happened. It could be that they're trying to protect your career by putting you in something you're better at, or they're trying to push you out slowly."

Consider the bigger picture. If you liked the job you've lost, ask whether your manager will consider reinstating you in the future. Crawford says it's also smart to ask for a follow-up meeting with your manager, because it saves you from making rash statements or decisions in the heat of the moment. "If you want to keep your job, then it's best to come humble," she says. "Explain that you understand the decision that was made, have had time to process and now want to talk about what you can do to improve."

According to Trunk, accepting less pay could keep you in a job and with a company that is otherwise compatible to your lifestyle and skills. "In almost every circumstance you're better off trading pay for title," she says. "Your job title has a lifelong impact on your career, because it shows up on your résumé, while your pay doesn't."

And ... consider a new job. If the demotion was unjust or the atmosphere is hostile then there is no reason to stay. Be thankful you have a job while you look for another one, because that's exactly what you should do. "Sometimes you should use a demotion as a sign," Trunk says. "You know before it happens that you hate the company and the company hates you, or that the company is struggling, so if a demotion happens because your boss hates you, or because they wanted to fire you but couldn't, then it's definitely the time to go get another job."



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