Having your wages cut can be shocking and financially devastating. Whether the business is struggling, your role has been changed, or the nature of your duties has been altered, your employer may decide to reduce your pay. Although this may feel like a blow to the ego or bank account, they are within their rights to cut your wages depending on certain factors. It is important to understand your rights and learn how to protect yourself in the workplace. Contact an Atlanta wage & hour law attorney today for more information and to obtain legal counsel.
Is My Employer Legally Allowed to Reduce My Pay?
Most employment in the United States is at-will. This means that both the employer and employee can terminate the employment relationship at any time and for generally any reason. In the same vein, an employer is within their rights to alter the terms of the employment agreement as well. This includes changing the employee’s wages or salary.
Employers are within their rights to reduce wages for work that has not yet been completed. The FLSA (Fair Labor Standards Act) requires that all employees (save seasonal, tipped, or exempt workers) make at least the federal minimum wage which is currently $7.25. As long as the reduction does not cause the nonexempt employee to make less than $7.25/hour, the employer is entitled to decrease wages.
When is it Illegal to Have Your Salary Reduced?
It is important to note that you must be paid for your hours at an accurate rate and wages cannot be reduced retroactively. For example, suppose you have been making $20/hour for 6 months and your employer has decided to reduce your pay to $18/hour. Any hours that were worked before your pay cut took effect must be paid in accordance with the $20 rate. If your boss reduced your wages on a Thursday, the paycheck you receive the next day for the past two weeks must represent the $20/hour agreement that you previously had.
Additionally, there are a few other instances that may be considered an illegal pay cut. Most states require the employer to notify the employee about their wage reduction, either verbally or in writing. Because Georgia state law abides solely by the FLSA which does not require a notification, this does not apply to GA employers. However, if the pay cut was based on discrimination against the employee, in opposition of an employment contract, or results in your income dropping below the minimum wage, the reduction is illegal.
Contact an Employment Lawyer Today
If your salary or hourly wage has been reduced it can be frustrating and upsetting. Depending on the circumstances of the situation there may be legal steps you can take to return your pay to its previous status or receive compensation. Reach out to a skilled employment lawyer to discuss your rights and options today.
