Nobody starts a job expecting their wages to go down over time. If anything, they expect their wages to slowly rise.
Employers are allowed to reduce an employee’s wages in most circumstances, but there are some important caveats. If you’re facing a reduction in your wages, here are the rules to remember:
Only future wages can be reduced
Your employer can tell you that they will be dropping your hourly rate going forward, but they can’t do it retroactively. Whatever you worked up to the moment they tell you must be paid at the previously agreed-upon rate. You also generally have the right to decline to continue working at the new rate.
A contract can determine your rights
If your employer gave you a contract, rather than taking you on as an at-will employee, then you’ll need to check your contract to see what, if anything, it says about the matter. if your wages are set by the agreement, your employer cannot unilaterally make the change.
Retaliatory cuts are not permitted
Employers cannot reduce someone’s wage in retaliation for taking part in a protected activity. For example, wages cannot be reduced for reporting sexual harassment, requesting reasonable accommodations or asking for medical leave. Wages also cannot be reduced for discriminatory reasons. For example, an employer cannot lower the wages of their Hispanic employees while leaving everyone else’s wages the same.
If you believe the reduction in your rate of pay is unlawful, it is wise to seek legal guidance to find out if it really is and examine what steps may be available to address the situation.