Using pay cuts to avoid layoffs might seem like a great idea, writes Michelle Conlin, but it can be murder on company morale. Conlin notes that some business leaders are trying to salve their employees' wounded egos with more time off or by targeting pay cuts to avoid angering vital employees. Using tiered pay cuts lets valuable employees know their hard work is being noticed, Conlin writes, and allows managers to reward workers who have to take on more responsibilities after a round of layoffs.

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