Just as some states have higher minimum wages for non-exempt workers, some states have higher minimum wages for exempt workers. For example, New York requires $536.10 per week for exemption status. An employer cannot reduce an exempt employee`s wage below the state minimum wage, otherwise the exemption will be lost. A wage reduction cannot bring the employee`s effective hourly rate below the minimum wage in a given work week because the employee`s hours of work fluctuate. But quick fixes to pay cuts that are not carefully thought out can only serve to expose employers to responsibilities they can only afford by cutting jobs they have tried to protect. A salary reduction is a reduction in an employee`s salary. Wage cuts are often made to reduce layoffs while saving the company money during a difficult economic time. A reduction in salary may be temporary or permanent, and may or may not be accompanied by a reduction in responsibilities. Some salary cuts also affect an employee`s salary increases, bonuses, and benefits.

Wage reductions for reasons contrary to public policy are also not legal. For example, an employee`s hours or salary cannot be reduced to take leave for jury service, serve in the National Guard, or give the denunciation in connection with an employer`s actions that are detrimental to the public. We ask that you reduce your monthly salary from $4,000 to $3,680 starting with one month. Your current position and duties remain the same. When an exempt employee`s salary is reduced, the employer often also reduces the hours expected of the exempt employee. An employer can reduce the “normal” hours that an exempt employee is expected to work while reducing their salary. For example, if an exempt employee`s salary is reduced by 20%, normal hours of work can be reduced by 20%. Different treatment requests are possible because an employee may claim that he or she has been selected for a salary reduction based on a protected category such as gender or race. If you are an employee who is not protected by a collective agreement or employment contract, there is no fixed amount you have to pay. However, employers cannot lower wages to levels below the minimum wage in their state.

If you are not protected by an employment contract or collective agreement, your employer can reduce your salary and work schedule at any time with certain restrictions. The document must be reviewed by the employer to determine whether the planned reduction in compensation, working days or hours of work can be implemented without breach of contract. If an employee`s consent to a change is required and the employee disagrees, this does not necessarily mean that an employer has no recourse. It may happen that an employer has the right to terminate the employment relationship completely, but not to negatively change the terms and conditions of employment. Whether the employee has the opportunity to choose the wage reduction agreement or must pay a contribution as a condition of employment that reduces his remuneration, the amount of the wage reduction is a salary for social security purposes because it has been received constructively by the employee. Instructions on the constructive receipt of salaries can be found under RS 01401.030. Under most state laws on the payment and collection of wages, employers must inform employees of their rates or wages and, if paid, the number of hours covered by wages. If an employer intends to change an employee`s wages or rate of pay or the hours covered by wages, it must usually give the employee reasonable notice.

In general, the laws on the payment and collection of state wages do not include a specific amount of notice required before any changes. In the absence of clear guidelines, the employer should try to give as much notice as possible. The employer may terminate the contract for amounts not yet earned. If a non-exempt worker is paid on a wage rather than hourly basis, their effective hourly rate cannot be lowered below the minimum wage at the federal, state, or local level, whichever is higher. In general, the employee`s effective hourly rate is calculated by dividing the employee`s weekly wage by 40 hours. If you decide to reject this pay cut, you will be removed from your position with severance pay as of one month after today. When reducing working hours, employers should use “wage base” language that makes it clear that employees receive lower but fixed wages each work week, regardless of the hours they work, subject to the deductions allowed by law. Changes in pay and hours of work cannot fluctuate as business fluctuates. The change should be considered long-term or indefinite as opposed to short-term or for a certain period of time. Otherwise, the cuts may appear as an excuse for the basic wage requirement. Wage Reduction Agreement means an agreement between the Participant and the Employer under which the Participant`s remuneration is reduced or an increase in remuneration amounting to an amount that the Employer must pay into the Participant Account is waived. A reduction in remuneration, with or without an appropriate reduction in working time, may also entitle workers to short-time working benefits under the applicable national law.

The concept is simple; In practice, however, determination and calculation can be painfully complicated. apply only to amounts earned by the employee after the agreement comes into force; and unlimited employment means that workers who do not have a formal employment contract or who are covered by a collective agreement can be dismissed, demoted and reduced in hours or paid at the discretion of the company. The legal risk is even greater if the employer does not reduce the wages or working hours of all employees in a particular position, but selects only certain employees in a particular position to be reduced. In these circumstances, employers must protect themselves against adverse effects and requests for different treatment. During this period, we will continue to monitor the company`s financial situation. If the company`s economic situation and performance improve in the next two quarters of the year, your previous salary can be restored. When an unsatisfied employee is paid on the basis of the FLSA`s fluctuating work week – a measure not permitted in some states such as California – the employee`s effective hourly rate is determined by dividing the employee`s base wage by the number of hours the employee works in a given work week. The more hours an employee works in a given work week, the lower their effective hourly rate, and this also becomes the regular rate for overtime. From a legal point of view, a nationwide pay cut is the safest. When everyone is treated equally, it is difficult for someone to credibly argue that they have been treated more harshly because they belong to a protected group or because that person has engaged in protected activity. However, general discounts may not be practical or desirable for commercial reasons. In these circumstances, employers should consider using the same type of procedures to reduce pay or hours of work as to reduce labour.

To the extent that certain items are selected for salary reductions or are exempt from reductions, the selection or exemption criteria should be as objective as possible and sufficiently documented. If an employee is exempt, the employee`s salary cannot be lowered below $455 per week or the employee is no longer exempt under the RSA. Workers with individual employment contracts or protection under trade union contracts are generally protected against wage or wage cuts during the periods covered by these contracts. .