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Below is a list of the most common customer questions. If you can’t find an answer to your question, please don’t hesitate to reach out to us.
Can an employer reduce an employee's pay to minimum wage during his or her two-weeks' notice period? The Fair Labor Standards Act generally does not prohibit an employer from reducing an at-will employee's hourly rate, provided the employee is paid at least minimum wage.
If an employer cuts an employee's pay without telling him, it is considered a breach of contract. Pay cuts are legal as long as they are not done discriminatorily (i.e., based on the employee's race, gender, religion, and/or age). To be legal, a person's earnings after the pay cut must also be at least minimum wage.
Employers can cancel a pay raise in most states without violating labor laws. If you are a member of a union, you may have some recourse, and circumstances regarding the revocation of your added compensation also may give you a foothold to file a complaint to regain your increase.
Can your employer reduce your hours, or lay you off? The short answer is only if your contract of employment allows it. Your employer can only lay you off or require you to go on reduced hours if your contract of employment allows it. If not, your employer will have to negotiate a change to your contract.
Most of the time it is legal to reduce an employee's pay but there are some instances in which it isn't. Surprise A surprise pay cut is illegal. Employers are obligated to pay employees the agreed-upon rate. If employers wish to change that rate, they can do so but first employees must agree to it.
If your employer asks for your consent to reduce your pay and you do not accept they may opt to terminate your contract on notice. Your notice is set out in your contract. Your employer may then offer you a new contract, with the reduced salary, although this is not guaranteed.
At-will employment doesn't just cover firing, however: An employer can also change the status of an at-will employee -- including, for example, the employee's hours, salary, title, job duties, worksite, and so on -- without notice and without cause.
If your employer asks you to work fewer hours or take a pay cut, this is a change to your contract of employment. Any change to your contract of employment must be agreed by both you and your employer. If you don't accept a reduction in your working hours or pay, your employer may decide to make you redundant.
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