Can your employer arbitrarily cut your salary in half?

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Can your employer arbitrarily cut your salary in half?

Bosses son took over company and
said my pay will be cut by half.

Asked on April 4, 2016 under Employment Labor Law, Pennsylvania

Answers:

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

Answered 5 years ago | Contributor

Do you have an employment contract or is there a union agreement that prohibits this pay cut? Was your treatment a form of legally actionable discrimination? If not, then as an "at will" employee" your company can set the terms and conditons of work much as it sees fit. This includes cutting your salary in half...anf or any reason or no reason at all, with or without notice. That having been said, the cut can only be for wages earned going forward; as to any already earned wages you must still be paid at your old rate.

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

Yes, unfortunately your employer may do this, unless you have a written employment contract setting your salary. (If you have such a contract, the employer must honor it.) Without a contract, you are an employee at will, and an employer may change or reduce an employee at will's salary at any time, for any reason (even "arbitrary" reasons), by any amount.


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