Doesn’t my employer have to give me some kind of notice before they cut my pay?

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Doesn’t my employer have to give me some kind of notice before they cut my pay?

I was working as a salaried manager at a company for 15 years. One day my regional manager came in and said we are changing your pay effective immediately. No advanced notice. You’ve been making $34,000 a year as a salaried manager and we are lowering you to $12.50 an hour effective. Also, your 44 hour work week is going to a 40 hour work week. Mind you, it’s already 3 days into the new period and we get a 1 commission on our bank deposits. Can they legally not pay me for what I thought I was working and the wage I was under the impression I was still earning? Doesn’t the company legally have to give me some kind of advanced notice for the change in my salary? They said the company isn’t doing so great anymore and it was no fault of my own.

Asked on July 14, 2016 under Employment Labor Law, Indiana

Answers:

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

Answered 4 years ago | Contributor

No, your employer need not give you advance notice of a pay cut unless it is mandated to do so under the terms of an employment contract or union/collective bargaining agreement. Also, such a reduction must not be the result of some form of legally actionable discrimination or retaliation (which it does not appear to be). The fact is that most employment relationships are "at will". This means that a comany can set the conditions of employment much as it sees fit. For their part, if an employee disagres with the condions set, they can either complain and risk termination or quit. That having been said, your pay reduction is legal only insofar as current and future wages; any past hours worked would have to be paid based on your former wage. If you gave any further questions, you can contact your state's department of labor.


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