What is ‘Salary Freeze’
The action of a company suspending salary increases for a period of time. By freezing salary increases for a given period, management is hoping that the company will be able to produce better bottom line results by keeping fixed costs controlled. The downside of a salary freeze for a company is that employee morale will typically take a hit and the firm may end up losing valuable employees due to compensation issues.
Explaining ‘Salary Freeze’
A salary freeze typically occurs when a company is experiencing financial difficulties. It may choose to freeze salaries temporarily in order to minimize layoffs. Once the company is in a better financial position, the salary freeze would likely be lifted.
Further Reading
- Reinventing school finance: Falling forward – www.tandfonline.com [PDF]
- Financial crisis, austerity, and health in Europe – www.sciencedirect.com [PDF]
- Economic Stabilisation in Argentina: The Austral Plan – www.jstor.org [PDF]
- The economic crisis and its effect on libraries – www.emerald.com [PDF]
- Comparative approach on education and healthcare in Romania and Bulgaria as beneficiaries of the IMF financial assistance – www.ceeol.com [PDF]
- Portugal and the global financial crisis: short-sighted politics, deteriorating public finances and the bailout imperative – www.elgaronline.com [PDF]
- Weathering the storm? Multinational companies and human resource management through the global financial crisis – www.emerald.com [PDF]
- The impact of pension freezes on firm value – repository.upenn.edu [PDF]
