It can certainly feel like wage theft when your boss tells you they’re going to reduce your pay. You were hired at a higher pay rate and you expected to earn that amount. For example, you might have taken the job because it paid $50 an hour, but now your boss has informed you that your pay will be reduced to $35 an hour. It may feel like they’re taking $15 an hour straight out of your bank account.
But is this actually a violation of your rights and an example of wage theft? It might be, but it depends on how the pay reduction is applied and structured.
No retroactive pay cuts
The critical point to understand is that pay reductions cannot apply retroactively. Employers cannot change the pay rate for hours you have already worked. If you worked under the understanding that you were earning $50 an hour, your employer must pay you that amount for those hours.
However, employers can inform you of a pay reduction that will apply to hours worked in the future. For example, if they notify you that your pay rate will be reduced to $35 an hour starting next week, this is legal. While it may feel unfair or unjust, it does not violate the law as long as you are informed in advance. At that point, you have the option to either continue working under the new conditions or leave the job.
Wage and hour issues
As you can see, this can be a nuanced issue, and it’s understandable if you are unhappy with your employer’s decisions. If you believe your employer is reducing your pay illegally or if you encounter other wage and hour concerns, it’s crucial to be aware of your legal options to protect your rights.