It’s incredibly disheartening to hear that your employer might lower your pay rate. Of course, everyone hopes for raises, and it can feel like a slap in the face when boss cuts your wages instead, especially if you were promised a certain amount when you accepted the job.
If you have a contract that specifies your pay, your employer cannot legally reduce your wages below the amount they promised you. For example, if your contract states you earn $100 an hour, your employer cannot decide to pay you $50 an hour instead. But what if you’re an at-will employee without a contract? Can your employer simply decide to lower your pay rate without your consent?
Only moving forward
First of all, yes, your employer does have the legal ability to reduce your pay. Your employer can inform you of a pay rate change, and you then have the choice to continue working under the new terms or to seek employment elsewhere. It’s crucial to note that any change in pay cannot be applied retroactively; you must be paid the agreed rate for any hours you have already worked.
In other words, your employer can only change the pay rate for hours you will work in the future, giving you a chance to walk away if you don’t want to work at that rate. Employers cannot change the pay rate that they promised you for hours that you have already worked.
Exceptions to consider
There are exceptions when lowering pay may be illegal in California. Pay cuts cannot discriminate against employees based on protected characteristics like race, gender or age. They also cannot be retaliatory against employees who engage in legally protected activities, such as whistleblowing or filing complaints. Further, a pay cut cannot result in you earning less than minimum wage. In these cases, employees may have legal recourse.
You can see how issues over pay may lead to some complex situations, and it’s important for you to know about your rights and options as an employee in California.
