Does an employee have any recourse if their employer decided to change their pay structure?

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Does an employee have any recourse if their employer decided to change their pay structure?

I’m in sales and my compensation is salary + commission, and my company has a bigger need in service so the company switched the entire sales department to servicing. I still receive the base + a monthly guarantee compensation. It is expected that in 8 months I will no longer receive the guarantee but receive an increase in salary and that will be 40% less than what I have received since I’ve been working there (3 years). We weren’t give any choice in switching to service and no option about our job other than leaving the company or finding work in another department. Do I have any recourse about this?

Asked on August 24, 2011 Virginia


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 12 years ago | Contributor

If you have an employment contract setting out your salary, then you may enforce that contract. However, in the absence of an employment contract, a comany is free to alter how pay is calculated or to reduce the pay of employees (or both), subject only to:

1) You must still get more than the minimum wage equivalent for the hours you work

2) If you are a non-exempt employee (not exempt from overtime), you must be paid overtime

3) No discriminatipon in how much people are paid on the basis of race, religion, sex, age over 40, disability, etc.

4) No retaliation against people in terms of cutting their salary because they used a protected benefit (e.g. FMLA) or brought a protected complaint (e.g. harassment or discrimination).

Otherwise, the comany can change your pay rate and structure, unfortunately, at will.

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.

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