Is it legal for an employer to offer a rate of compensation to an employee at the time of hire and later pay them at rate lower than agreed upon?

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Is it legal for an employer to offer a rate of compensation to an employee at the time of hire and later pay them at rate lower than agreed upon?

Asked on November 21, 2011 under Employment Labor Law, California

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

If there is no employment contract guarantying your rate of pay, then the employer can change your pay at will, without prior notice, except in the following case:

If the employer told you that the job paid at a certain rate to get you to take the job; it was reliable for you to rely on what the employer said (i.e. it was plausible); you did something to your detriment to take the job (e.g. gave up an existing job; relocated); and the employer knew or should  have known that you'd do something to your detriment in reliance on what it said...then that may be enough to make the promised pay enforceable. But without these circumstances, or a contract, the employer may change/lower the pay rate at will.


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