Can a company change you from salary to hourly and then reduce your hourly rate?

Get Legal Help Today

 Secured with SHA-256 Encryption

Can a company change you from salary to hourly and then reduce your hourly rate?

I was hired full time salary, then my position without a reasonable explanation was changed but I was still salary. After working in the new position for approximately 8 months, I was changed from salary to hourly when the new Federal overtime law came to light. I was told I was also getting a raise, but when I did the math, I found that I will be making less. I also went without a review or raise for 2 years. Is this legal?

Asked on October 29, 2016 under Employment Labor Law, New Jersey

Answers:

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

Answered 5 years ago | Contributor

Absent an applicable union agreement or employment contract, most employment is "at will". This means that a company can set the terms and conditions of work much as it sees fit. This typically includes what wage to pay, to whom, and when such a wage can be increased or decreased. That having been said, employers who switch back and forth between classifying salaried exempt employees as hourly non-exempt employeess, and vice versa, may be guilty of incorrectly classifying its workers. The U.S. Department of Labor Wage and Hour Division looks unfavorably on businesses who do this. That having been said, once an employee is classified as salaried exempt or hourly non-exempt, this doesn't necessarily mean that an employer can't change their classification, it's just that there must be a reasonable justification for doing so. For further information you can contact your state's department of labor and/or consult directly with a local employment law attorney.


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 AttorneyPages.com 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.

Get Legal Help Today

Find the right lawyer for your legal issue.

 Secured with SHA-256 Encryption