My first company did that through the 2008 recession and it was really nice of them. Nobody got raises and nobody got bonuses (which significantly impacted higher-ups more as much more of their pay consisted of bonuses). The three co-founders barely even took any salary at all.

But no one was laid off. All that happened was that one guy who had temporarily left to finish a master's degree wasn't rehired as expected (I think it also didn't help that he wasn't that good).