Does an employer need a reason to decrease a worker’s hourly rate of pay?

We are currently W-2 employees and paid on a per file basis of $30 a file. If and when we are paid hourly we receive $30 per hour. Now our employer is making us go hourly at $25 per hour. Does he need a reason to reduce our hourly rate by $5 per hour? We have not received any negative performance reviews in the 11 years we have worked for this employer.

Asked on July 18, 2015 under Employment Labor Law, Georgia


M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

First of all, does this action violate the terms of any union agreement, employment contract or company policy? Or is this treatment the result of actionable discrimination? If not then it is legal.

The fact is that most work relationships are "at will". Consequently, an employer can set the terms of the workplace much as it sees fit. This means that it can decrease pay rates for any reason or no reason at all.

Note: A decrease in pay is legal unless�the employee is exempt and the decrease will bring their hourly rate below the state minimum wage.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.