Can my employer unilaterally reduce my salary?

By law, employers cannot unilaterally cut an employee’s pay. No one can force you to take a pay cut, so you could reject such an offer even if your fellow workers accept.

When is a salary reduction legal for an employee?

A salary reduction also frequently occurs when an employee decides to leave a current management role to go back into a job as an individual contributor. In a third scenario, say that you are job searching.

Is there any legal way to reduce an exempt employees salary?

Is there any legal way to reduce an exempt employee’s salary? The answer is “yes.” Under certain circumstances, an exempt employee’s salary can be reduced, according to the U.S. Department of Labor.

Can a corporation reduce an employee’s salary without their consent?

The corporation should be aware that if – as an employer – it moves to reduce an employee’s salary without their consent, the employee will be entitled to: continue to work under protest but sue for compensation for the loss they have suffered because of their reduced salary.

Is it legal for an employer to cut your salary?

Sometimes it’s legal for an employer to reduce an employee’s pay and sometimes it’s not. Pay Going Forward, Not Backward . This is the most important rule in salary reductions. The employer must pay you the agreed-upon salary for work you’ve already done. Bosses can absolutely lower salaries just like they can raise salaries.

Is it legal to reduce an employee’s salary?

The key, according to several courts, is that reductions in current salary are prohibited, but a prospective reduction in salary is permissible because the amount is predetermined before it takes effect, and the employee knows what the salary amount will be before he or she performs the work.

Can a employer unilaterally cut an employee’s pay?

By law, employers cannot unilaterally cut an employee’s pay. If, in exceptional circumstances such as the current recession, employees agree, they need to be aware of the implications for any subsequent redundancy payment and their pension rights (see below).

Can a company reduce the salary of an exempt employee?

Yes. According to guidance issued by the U.S. Department of Labor, an employer may make a prospective reduction in pay for a salaried exempt employee during a business or economic slowdown, provided the change is not used to evade salary basis requirements and the employee still receives at least $455 per week.

Can a union negotiate a pay cut for an employee?

Yes. Reductions in an employee’s compensation or hours generally must be negotiated with the union that represents the employee, unless the collective bargaining agreement gives the employer the right to make such reductions. 5) How should an employer determine which employees will receive a cut in hours or pay? Carefully.