Is my employer allowed to change my status from hourly to salary to avoid paying overtime hours?

UPDATED: Sep 30, 2022

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Is my employer allowed to change my status from hourly to salary to avoid paying overtime hours?

I am paid every other week. After working 19hours of overtime in a 2 week period, I was only paid for 40 hours per week. I was previously paid salary but my employer changed my position to hourly before the Thanksgiving holiday. Therefore, I did not receive pay for any holidays the shop was closed. After the holiday, I worked 19 hours of overtime in a 2 week pay period. I was only paid for 80 hours of regular time pay. I was not given any compensation for the 19 hours worked, via regular hourly or overtime pay. My employer did not inform me that he had or was planning to change my status from hourly. Is it legal for him to do this or can I take action against him?

Asked on December 26, 2016 under Employment Labor Law, Texas


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 6 years ago | Contributor

Your employer can change your status at will (unless you have a written employment contract guarantying it), but only going forward--from when you are told of the change and after--not retroactively, for work already done. So if in weeks 1 & 2, you were hourly and worked 19 hours overtime, then the employer changed you to salary at the start of week 3, you had to be paid on an hourly basis, including overtime, for weeks 1 & 2. If the employer retroactively changes your status to avoid overtime for work already done, it has violated labor law (e.g. the Fair Labor Standards Act) and commited breach of contract (violation of the oral agreement, which can be changed at will by the employer, but only *after* notice, under which you had already done the work in exchange for an hourly wage). You could potentially contact the state or federal Dept. of Labor to file a complaint, and/or possibly sue (e.g. in small claims court) for the money.

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