Being an all-you-can-eat employee also means that the number of hours you work for your employer is not guaranteed. However, if there is an employment or bargaining contract, your employer may not be able to reduce your wages or hours of work under the law. The first question we need to ask ourselves when deciding whether an employer is allowed to lower an employee`s rate of pay is why. Why this drop in salary? Why this employee? Discrimination based on a protected characteristic such as race, sex, religion, age or national origin is illegal in the workplace. This means that an employer cannot lower an employee`s wage rate based on a protected characteristic. Retaliation for participating in “protected activities” is also illegal. Protected activities may include complaints of unlawful discrimination or harassment, complaints of non-payment of overtime, and reporting illegal activities from an employer to a government agency. It is illegal for an employer to lower an employee`s salary for a discriminatory or retaliatory reason. Wage laws can also regulate a reduction in wages. Your employer must pay you the agreed wage for the work you have already done; While they can cut wages in the same way they can raise wages, they can`t cut your salary without letting you know in advance.
In addition, as an employee, you must accept the salary reduction. When a candidate accepts the annual or hourly salary specified in a job offer, two expectations are raised. The new employee agrees to devote her time and talent to the tasks for which she was hired and receives the promised salary in return. The employer expects the employee to spend the time necessary to fulfill his or her responsibilities in exchange for fulfilling his or her agreement to pay the promised amount. However, there may be situations, such as when a company is experiencing financial difficulties, where the employer decides to reduce an employee`s salary. Although the Fair Labour Standards Act of 1938 is the federal law that imposes wages, overtime pay, hours of work and child labour, it does not contain provisions on lowering employees` wages. The federal government only says that employers cannot lower the hourly wage by an hourly wage below the hourly minimum wage, any more than an employer can lower the threshold to fill the employee exemption. At the time of publication, the hourly minimum wage is $7.25 and the minimum wage rate is $455 per week. A salary reduction is a reduction in an employee`s remuneration. It could be a reduction in salary, benefits, hours of work and more – it`s not just financial compensation. This can happen for a variety of reasons. For example, a company may try to avoid layoffs and/or save money in turbulent times, with the intention of bringing wages back to normal once the threat is over.
If you are exposed to a pay cut, you should contact a lawyer who is familiar with labour law issues. An employment lawyer can help you decide whether to take legal action with a state agency or file a private lawsuit, and will represent you in court throughout the process if necessary. This means that you can leave your job before you do a job at the lower rate of pay offered. This is legal and may make the most sense for you if your employer orders a pay cut. Since a wage cut is detrimental to employees, it is imperative that if the boss has to lower wages for financial reasons, he receives the same percentage of wage reduction. Another example of cases where it is appropriate to reduce an employee`s salary would be when there is a significant job change. If there is a demotion and the previous salary is significantly higher than what other people in the new position receive, a pay cut could make sense. That said, your employer can legally reduce the hours of work of your full-time, part-time and lower employees, and reduce your salary as much as they want – as long as they never violate the Act respecting labour standards.
fair (FLSA) by falling below the minimum wage (at the federal or state level, with the lower threshold). Even if you work overtime during your payment time, you are still entitled to an hour and a half. In general, an employer can legally reduce your salary if you are an employee at will. To repeat, most states have determined that the employer is required to inform you first of the wage reduction. In addition, some States have stipulated that such notification must be made in writing. Once you have been notified, the employer can pay you at the lower rate. Yes, but only if there is an employment contract or collective agreement. If you don`t have a contract, your employer can legally reduce your working hours or reduce your salary, and you may not have recourse. Unless you are protected by a union or employment contract, your employer can legally dismiss, downgrade or change your working hours at any time and for any reason.
If your employer has reduced your salary or hours, you may be wondering if it`s legal. In many cases, it is legal for employers to reduce workers` working hours or wages. Unlimited employees are generally not guaranteed that a certain number of hours of work per week or that their salary will remain the same. Unless you work under a collective agreement or employment contract, your employer generally has the right to reduce your hours and wages. However, there are situations where working time and wage cuts are illegal. Swartz Swidler`s lawyers can help you determine if your employer acted illegally when your salary or hours were reduced. Aside from labor and labor laws at the federal and state levels related to falling employee wages, there is a factor in employee relations to consider when lowering employee wages. Employees rely on their salary to meet their obligations and maintain their lifestyle, and they often make the decision to join one company rather than join another based on their salary. Reducing an employee`s salary could have devastating effects in some households and, just as importantly, it can lead to employee mistrust. Distrust often leads to increased staff turnover, low job satisfaction, and ultimately a lack of productivity and reduced profitability for the employer.
While federal law does not prohibit lowering workers` wages, the employer should weigh its options to determine whether it has alternatives to resolving cash flow or staffing issues that may be behind the decision to cut wages. Federal law does not prohibit lowering workers` wages. However, some state laws impose certain measures that employers must take before cutting wages. State laws vary. For example, Nevada requires at least seven days` written notice before the employee performs the work that is subject to a pay cut. Maine employers don`t need to be notified. However, in Texas, employers who propose a wage cut must provide written notice, and if the reduction is 20% or more, the employer can reasonably expect to lose workers who resign for good reasons due to the wage cut. Employees are no exception when it comes to a possible pay cut. Although full-time employees must receive the agreed salary for work already done, they are still subject to a wage reduction. However, an employer must inform an employee in advance and the employee must accept the lower rate of pay. If you are still employed and your salary has been legally reduced, it is best to solve the problem before immediately involving the government.
One of the first steps to take is to use payroll to clarify whether the salary has been reduced intentionally or accidentally. Errors do occur, and if they do, your payroll department can correct the error quickly. There are a few exceptions to these guidelines. The first is that an employer may have a rule that the last week of employees` wages is paid at a lower rate, not lower than the minimum wage, if workers leave without notice. As long as it is a written agreement signed by the employees (or included in a manual that the employees have confirmed), this is considered sufficient notification for the salary reduction, since the decision to leave without notice is under the control of the employees. Another important exception to all the above guidelines is that most workers are entitled to at least one minimum wage (as long as they are not exempt from the minimum wage requirements). Thus, even if it is a situation where it would otherwise be legal for an employer to reduce an employee`s rate of pay, that rate cannot be lowered below the minimum amount that the employer must pay under Michigan law and federal law. If you learn of the pay cut after you`ve already quit your job, you can file a complaint with your State Department of Labor. However, if you are still employed, you should try to solve the problem internally. You can do this by clarifying with payroll if reducing payroll is a mistake, as payroll can easily correct the error.
