[machinebun]

Pay cuts are a pretty accepted alternative to layoffs during recessions... I think it certainly depends. It's more of an ethical question - as legally, I'm pretty sure the company can implement a salary cut whenever it wants.

[tuukkah]

If a recession caused Google to run out of money, the pay cuts could be justified much better, but that's not the situation at hand.

I think the ethics (and legality?) of arbitrary pay cuts go hand in hand with arbitrary firings: cutting a salary to $1 is essentially the same as a firing. Legality then would logically depend on whether the employment contract is under a state jurisdiction with at-will employment or if there is a requirement of a just cause.