Ohio- Retroactive Pay Cut
In Ohio, is it legal for a company to issue a company-wide pay cut that was effective 7 days prior to a verbal notice?
1 answer | asked Mar 8, 2017 4:29 PM [EST] | applies to Ohio
Answers (1)
Probably not.
The general rule for employment in Ohio is at-will. That means that an employer or employee can end the at-will employment at any time. At that point, neither party has any obligation to the other, except for the employer to make good on the promise to pay the agreed upon wage up to the termination of the at-will employment.
From this follows the rule that an employer can change an at-will employee's compensation at any time, but again, must pay the agreed upon compensation earned up to the time of the change in pay.
Therefore, an employer's retroactive pay cut is, in the eyes of the law, probably a breach of its agreement to pay at the original wage rate. It is a breach up to the time that the employer announced the pay cut, and the employees had the option to quit working if they chose, but not afterwards. After the announcement, the employees options are to accept the pay cut or else vote with their feet against it, and end the employment altogether.
Two questions:
What was the amount of the cut?
How many employees did it affect?
You can email me at Neil@EKRTLaw.com.
posted by Neil Klingshirn | Mar 9, 2017 09:55 AM [EST]
The general rule for employment in Ohio is at-will. That means that an employer or employee can end the at-will employment at any time. At that point, neither party has any obligation to the other, except for the employer to make good on the promise to pay the agreed upon wage up to the termination of the at-will employment.
From this follows the rule that an employer can change an at-will employee's compensation at any time, but again, must pay the agreed upon compensation earned up to the time of the change in pay.
Therefore, an employer's retroactive pay cut is, in the eyes of the law, probably a breach of its agreement to pay at the original wage rate. It is a breach up to the time that the employer announced the pay cut, and the employees had the option to quit working if they chose, but not afterwards. After the announcement, the employees options are to accept the pay cut or else vote with their feet against it, and end the employment altogether.
Two questions:
What was the amount of the cut?
How many employees did it affect?
You can email me at Neil@EKRTLaw.com.
posted by Neil Klingshirn | Mar 9, 2017 09:55 AM [EST]
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