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My Job is Cutting My Salary—What Can I Do?

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My Job is Cutting My Salary—What Can I Do?

I accepted a job offer six months ago that was supposed to be full-time with benefits, but they initially hired me as a contractor. They offered $79K for the contract period, with the understanding that I’d transition to full-time at the same rate but with benefits and equity. I had asked for a higher salary, and they assured me we could renegotiate when I officially moved to full-time. I have all of this in writing, though not in contract.

Now, months later, they’re offering me $75K—actually, they originally proposed $65K and only raised it after I pushed back—while expanding my responsibilities and giving me a higher title.

The benefits include 15 PTO days, 5 legally required sick days, and 10 federal holidays. They offered 100% covered health insurance, but the plan options were so bad that I’d end up paying more than I do now.

Instead, they agreed to reimburse me for my own marketplace plan, though it would be considered taxable income. There’s also equity, but that doesn’t help with my immediate financial situation. I should note they are a start-up.

At one point, they offered me a $2,500 laptop, and I asked if they could just add that to my base salary, bringing it to $77,500. They initially agreed but are now backtracking, saying it would instead be a small monthly stipend over three years.

They also gave me the option to stay on as a contractor at $93,600, but it was made clear that doing so would signal I’m not committed to growing with the company.

I feel frustrated and demoralized. When I tried to negotiate, my commitment was questioned. I was ready to move forward at $77,500—even though it was already lower than the original offer—because they agreed to a performance and salary review in September. But now, they’re cutting it even further. I live in an expensive city, and this offer is about $20K below market rate.

The difficult part is that I genuinely love my team, my day-to-day work, and the company’s mission. I don’t want to leave, but I also don’t want to be undervalued. Is there any way to salvage this?

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  1. Anonymous

    This company is playing by some really obnoxious negotiating tactics. They would offer you 21K more as a contractor? Unless you are going in as a 1099 and are not getting any benefits, I can see the 21K difference. However, to question your commitment by saying if you don't take the full-time offer, you are not valued. I'd take the contract then find your next gig. This is not a company that seems to value your work. The hard ball push back from 65K to 77K is ridiculous. They are using your emotions by saying you are not committed if you take the $93600. I would tell them, I am committed, but I have expenses that have to be met. We made an agreement, I've enjoyed the work and company and will continue that commitment at the contractor rate. But I'd be looking elsewhere as emotional negotiation is child's play.

  2. Anonymous

    Yeah, basically they would offer me $93,600 if I stay contract, but that means no PTO (30 days) and no health insurance reimbursement (about 7500). I do feel it's been very manipulative. I have the $79k full-time offer in an email from September. The fact that I'm getting a new title an additional responsibilities with a $4k pay CUT to go full-time is crazy to me, even if they are a start-up.

  3. Anonymous

    Yeah the difference is their overhead of benefits. Decide if you want to stay long term and consider how hard will it be to leave finding an opportunity in the 90’sK with full benefits, and remember you had to push to get 77. Go back to the table and request 85300. That’s the average of their top full time of 77 and the contractor rate of 93600. Try again and see if you can get the 85300.

  4. Anonymous

    This is always the risk. Their verbal promise was never a signed written offer. When they changed their original offer of employment to a contractor status position, they backtracked. When they didn't honor their offer to increase your base in lieu of a laptop they backtracked.....and on and on.

    This company is a bait and switch. So you have to take what you can get and hope for the best. There is nothing illegal. Just shady. It's completely dependent on your willingness to accept the reality. Kind of like a bad boyfriend that never lives up to his promises. It is what it is. And you are asking the same questions in this scenario.

    Can you salvage things? Sure if you accept the realty and don't bank on their promises. Remember that Market Value is not this company. This company is bait and switch.

    It's up to you whether your love of your team makes up for the missing $

  5. Anonymous

    Does it make a difference if the original full-time offer was in email? And the boyfriend analogy is sadly so accurate.

  6. Anonymous

    I think the email was a dialog but what was actually accepted by you was that the contractor status position. It would be a legal issue if a written contract was signed by both parties and after you began work, the company breached the terms and began paying you at a lower rate with Contractor status and no benefits, no pto accural, etc.

  7. Joan Williams, Senior Talent Acquisition Specialist

    Personally, the way I feel about this is that they have lied to you at every turn. Have not kept their promises - even those in writing.

    This is not a company that I would consider staying at long term because typically, a leopard doesn't change it's spots. Things like this behavior tend to mushroom - so if I had to guess, I'd say it's going to get worse. And then you'll have/be more invested, be more reluctant to leave, they'll realize they have you and treat you worse. Rinse and repeat.

    As an employee, all you have to invest is your time. I always recommend folks invest their time where it's going to pay off for them in the long run. For me, a company that treats their employees that way is not a company I could be happy at long term. I know that about myself because I've been lied to enough to not let it happen to me again. To cut my losses.

    I absolutely would not let them "charge" you for a company laptop. Why should you pay taxes on that? Pretty sure they will be deducting that as an expense. The companies I've worked at as a contractor have always provided a laptop - their IT security would never allow me to use my own computer.

    You wrote "because they agreed to a performance and salary review in September."

    I don't see how you could be at all confident that they would keep their word about that - and even if they did do a review in September - that's no guarantee they're going to cough up any additional money.

    Personally, I would take the $93,600 now and fire up that resume and start a job search.

    How many posts do we read on here that are some version of "I tried to make it work even though there were red flags all over the place - I stayed 5 years longer than I should have, now my mental health is suffering and I'm 5 years behind in what would have been the raises I should have received".

    You already know what they think of you "Now, months later, they’re offering me $75K—actually, they originally proposed $65K and only raised it after I pushed back—while expanding my responsibilities and giving me a higher title."

    They offered you $10k less for more work.

  8. GirlBossanova934974

    Startups come with all sorts of inherent instability. If you are looking for a stable job, that probably was a bad choice. Finances can change quickly and many startup owners will simply try to weasel out of what they promised. The FACT that they are coming with the GASLIGHT ROUTINE of you are not with the team and that sort of garbage, tells me these folks are not to be trusted again. Take the salary position and the minute you do, start looking for another job! It is that simple.

  9. Tricia Burroughs

    This is all a bit sus and while it is true that contractors get more because they cover their own benefits, I would say to them - hey it is going to take you 6 months of training someone else to get to the place I am. That is $38k. How about you increase my pay by $15k and we both beenefit?

  10. Tom

    Unless you have other offers, I would negotiate the best deal possible and move on. I believe the likelihood, in a good job market, is you will no longer be there in approximately 6 months as a result of story you've conveyed. We could play the "what if' game all day long, but this is how I see things working out for you.

  11. Anonymous

    Stop being fooled by oral offers until you see job functions, location, payscale on paper contracts with your name on it, match with what you have applied for. People are not following federal laws, for past years you have no salary increase and not getting a real paycheck on time as job description stated, you should consider to look for higher pay back to office full time job, outdoor not indoor.

  12. Milissa Jacobs

    I'm afraid that you have learned a big lesson. Always get EVERYTHING in writing. It seems like this startup is having some financial issues, be careful if you choose to stay there. You really don't have many options. Stay for now, but I'd be dusting off that resume.

  13. Anonymous

    Sorry, but you should have set expectations for what you hoped to get up front. When you convert to FTE from contractor especially in a startup you get what they have in their limited rewards program. Most startups cannot afford to buy into benefits programs that cover their employees 100% but theirs did and that has a value. The benefits programs factor in about 30% to your overall compensation. Also equity should not be overlooked and is the main reason for being in a startup. It is a multiplier. If you have stock options that vest over a period of time and after 1 year there is a cliff (usually 25%) vested overall and say the price is 1.00 to you and you option it when they go public at say $10.00 you earn $9.00 for every share. So while that doesn't do anything now it will later on. I know this personally and it is the reason I have major breathing room now. Also as for the equipment as a contractor if you bought your own computer you could write it off as a tax deduction and expense. Rolling it into your salary did not make sense because it amounts to a few hundred dollars and not benefiting you it would have been smarter to negotiate like this. They can write it off by giving you the money in spurts as it affects their budget.

    So the choice is stay as a contractor for much more, no benefits you get to do what you want when you want and pay your own taxes and get write offs or get the security (if there is such a thing in a startup) and become part of their overall future and possibly yours.

    If it were me I would stay as a contractor and keep looking around because you have kind of let them know you are not buying what they are selling.

    In future the better way to do this is reduce it to the ridiculous and let them know what amount per the hours of work you do per week they are actually paying you. Use market data and create a spreadsheet showing your productivity and then compare it to other similar sized and stage companies.

  14. Anonymous

    May be taking an unpopular opinion here, but were it me, I'd stay in the position for now. Not sure what to do about the health insurance costs, but you have a job now that you like (or at least you like your team). I do believe it's easier to get a job when you have a job. The market is going through hard times suddenly and there will be many recently fired/laid off people competing for other jobs. Learn everything you can in this position, and the higher position (more work, less pay, I know), and network where and how you can. It's a crappy deal ad you know it, but it's also the only deal you have on the table right now, and it will bankroll your search for something else. Good luck to you.

  15. Julie E

    I would take the $93,000 as a contractor and start looking for another job. They will continue to jerk you around. Never take a pay cut, especially if they’re adding more responsibilities.

  16. Anonymous

    It sounds like they’re negotiating with you and have provided two options.

    another lease to look at the offer, if you took off 15 days as a contractor at $79k you’d be making less than the $75k salary offer.

    Plus, you need to account for as a contract/self-employed employee paying additional taxes for Social Security and Medicare, and saving out and managing quarterly self-employment taxes.

  17. William Neumann

    Depends on the position and the market. Software Development in the Indianapolis market might well be $75K ... but not in Raleigh. Bottom line you generally lose a bit in salary in lieu of benefits when you convert from contract to hire. Whether it's a good rate depends on the factors i listed above.

  18. Anonymous

    In reply to the comment "be thankful you have a job". Your reply is subservient , useless and irrelevant to the post. Go back and read through those comments that offer solutions through real- world advice.

  19. Dawn Cross

    Like several had said, you can do the “what if”.

    I think a better question is if you really want this job. Yes, it is less, but as you indicated, they are a start up. What is the potential longevity of the company? Is it possible they are offering less now with the possibility of growth in the future?

    While the 77,500 is less than what you are making now as a contractor, they are paying for a laptop, ACA instead of company benefits and a fairly good vacation and sick policy. Not many companies do that these days.

    Only you can decide if this is worth your time.

  20. Marian Davidson

    The problem with a start up is even as a full time employee, you have little job security- less than with a larger company. I would take the 93,600 and shop the marketplace for your own preferred healthcare plan. Maybe some of your office supplies, computer, and other materials would be deductible on your income tax. You also get the marketplace benefit. When they try to play the “you’re not committed to the company” card, graciously say that you are happy to continue to help the company grow while their financials stabilize. Try to get in writing the terms, and another six month term. Then get in writing that you both re-examine at the 5-month mark the transition to staff. Do not accept equity in lieu of salary. I’ve been with startups and had stock option as part of my benefits package. But that only works if they ever go to the stock market. It’s just an empty promise so plan on never seeing any benefit there. Good luck.

  21. Wanda Shaw

    Please don’t say that you have no hope. My dear, as long as you’re upright and breathing there is hope. And your resolution is on it’s way

  22. Anonymous

    It appears that the company might be offering you the maximum that is possible at this time. Yes, it's lower than what was initially offered but then the projected financial health of the company may not have turned out to be as once hoped. It's a start-up and until fully established and fully gaining firm traction in the marketplace, there may be more ups and downs that you'll have to navigate, including more salary concessions. No shade on the company, it's where you are. Of course, if you like what you're doing the direction the company is going and what it stands for, accept the salary as is and continue to shine. On the other hand, you know your worth, and if you feel that you deserve much better than what is offered, then continue with the contract agreement rate and begin looking for other opportunities that may suit you.

  23. Anonymous

    ? Either offer take the and keep looking .

  24. Anonymous

    They claim you aren't committed?! Take the contractor salary and look for a new job. I get it - we are all under budget pressure but several grand which makes a difference to you shouldn't be detrimental to the company.

    I think it's a valuable point to make to your manager - I am committed, I truly enjoy the work and the people but I also know my worth and was provided a pathway to negotiate and now being given the bait and switch. If your account of the situation is fairly reflecting both sides then I think you should push hard for them to live up to their side of things.

  25. Anonymous

    I use to work in HR in the corporate world. I now work for a nonprofit doing other things non hr related. When negotiating with HR, it's called the Total Compensation Package. What they company has to pay out which includes the salary, vacation, sick time, etc. With the labtop, I am making the assumption that they would own the labtop and not you. Since they are spending the 2500 dollars for it. Unless they are gifting you the labtop. Also, like others have stated, it's possible they didn't meet their financial goals, since they are a start-up company, and the reason for the lower salary. Next time get the information in writing. In addition to this, the job market is kinda tough now. I do not like that they played the "Team Card" game. That was unnecessary,It Could of been they were at a loss of words and didn't know what to say. When reviewing your current salary and the salary that they offered, the Total Compensation Package would hit above the 79k mark if I am reading it correctly. Whatever you decide to do, write out your pros and cons and if you decide to stay and the start up increases financially, you never know a raise may come. Or like others have stated you could wait it out and stay with them in either role while looking for another opportunity.

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