Can a employer reduce your wages by 35% if you signed a offer letter of employment for a different amount?

I was hired at a base pay of $18 per hour and possibly commissions later on. Now they are reducing our pay to $12 per hour and giving us 22% commissions on 5% base (if I make $20k in sales the company makes 5% of that, then I get 22% of the 5% so $220).

Asked on December 7, 2011 under Employment Labor Law, Nevada


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 8 years ago | Contributor

It's possible that they could do this--it depends on the circumstances. For example, if you had an offer letter laying out your compensation, they almost certainly could not change it the day or week after  you started. However, if the offer letter did not guaranty your salary for a set time, then they could almost certainly change or reduce your salary after a year--an initial offer letter does not bind an employer foreover, unless the letter, by its very terms, contemplates that your salary is set for a fixed period.

Therefore, the context and facts are critical. For example, exactly what was said in the offer letter? How long into your employment was your compensation reduced? Even whether  the new structure is really a reduction (i.e. can you make more or less as much as you had under the old structure, if you sell as much as you should?) is a factor to consider. You should bring a copy of the offer letter to an employment attorney, who can evaluate it and the facts in detail. Good luck.

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