The plan also includes more than twenty furlough days over the next two years.
Most of the people who work here at the county administration building, and most other county departments , will start the new year making five percent less than they do right now.
Top officials say it's a necessary step to deal with a ten million dollar budget deficit.
The Merced County Board of Supervisors approved a plan Tuesday to save about a two million dollars a year for the next two years.
"Almost 90% of the employees within the workforce have reached an agreement on a 5% reduction in salary in exchange for furlough days, or time off," Merced County assistant CEO Jim Brown said.
Brown will be taking over as the county's CEO next month. He says the pay cuts will be distributed evenly throughout the year, but most of the furlough days will come at the end of December.
"The furlough days will be structured so they're at times where there should be the least impact on county services and generally around the Christmas week," Brown said.
Some employees who did not want to speak on camera say they're happy the time off will come during the holidays. But others tell Action News the furloughs mean they'll be forced to do more work in less time.
The only county employees not taking furlough days are those who work in 24-hour public safety roles. But those who have reached a deal with the county are still taking two and a half percent pay cuts.
"In my situation, my wife actually works for the county, she's going to take a 5%, so it will actually mean a 7.5% cut in my household. We're going to have to tighten our belts, just like everybody else. Just make the dollar stretch a little bit further," Sgt. Jim Pacheco, Representative for Operational Sergeants, said.
Still, Pacheco and other employees we spoke with say they would rather take these cuts than see more widespread lay-offs.
The county is still negotiating with a few groups, and the goal is to trim another half million dollars.
The pay cuts and furlough days start in January and continue through the end of 2013.