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Can my employer just lower employee's pay?

Seattle, WA |

I work for a marketing company and we make 25 an hour, and we just got a memo saying that on june 1st our pay will now be 21 an hour. That is a major pay reduction. This isn't based on performance or anything. Does the company have the right to do this?

Attorney Answers 3

  1. If you are an employee at will without an employment contract, the answer is yes. In these tough economic times such reductions are becoming more and more common.

    Good luck to you.

    NOTE: This answer is made available by the lawyer for educational purposes only. By using or participating in this site you understand that there is no attorney client privilege between you and the attorney responding. This site should not be used as a substitute for competent legal advice from a licensed professional attorney that practices in the subject practice discipline and with whom you have an atttorney client relationship along with all the privileges that relationship provides. The law changes frequently and varies from jurisdiction to jurisdiction. The information and materials provided are general in nature, and may not apply to a specific factual or legal circumstance described in the question.

  2. I agree. If you have no contract and are employed at will, they can reduce your pay or terminate you, and your recourse is to find another job.

    I am not licensed to practice law in Washington so the foregoing should not be taken as legal advice, but simply as educational information intended to be helpful. If you need legal advice, please consult a lawyer who holds Washington licensure.

    Good luck.

  3. I'm adding my answer to the list already posted because I AM licensed to practice in the State of Washington, so you need not wonder whether a different rule might apply here.

    Unfortunately, the employer can legally cut your pay going forward. Here are some additional things that might be helpful to know:

    1) The employer cannot cut your pay retroactively (for work that you have already done.)
    2) If your rate of pay is established by contract (either a collective bargaining agreement or an individual contract), the pay cannot be cut unless provided for in the contract.
    3) Minimum wage in Washington State is $8.55/hour.
    4) If your compensation,or your hours, are reduced by 25% or more, you will qualify for unemployment compensation if you resign.

    Reductions in pay are happening quite a lot. Sometimes this is because employers are trying to avoid laying anyone off, and sometimes employers are just taking advantage of the market. There is no way to tell which is happening in any given case, and no recourse if the motivation turns out to be opportunism.

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