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Employees have an opportunity to increase their salary by means of the work they perform. This opportunity is given to them through the pay for performance system. The base pay is generally determined mutually by the employer and the employee and this is paid based on quarterly or annual review of the employee’s performance. Differences may crop up between the employer and the employee with regards to the evaluation grade provided to the employee. Below are a few questions that have been answered regarding pay for performance compensation: In the event that there is a letter of employment with details of the yearly performance increase that would need to be given to an employee; is it required that the employer abide by it as per law?
Details mentioned in the letter of employment would decide if an increase would need to be paid or not. It would be possible for an employee to enforce the agreement if the terms are worded in such a way that the employer promises a definite action and non-conformance could lead to court action. It is up to the employer’s discretion as to what would qualify for a raise or a bonus. If one employee who has done the same amount of work as another employee but did not receive a performance raise when the other employee did; one will need to prove this. Consider a situation where a performance pay employee has already resigned. Is it lawful for a company to terminate such an employee after denying vacation pay?
Legally, one may not be able to do anything if as per company policy one cannot go on two weeks of consecutive vacation and the employer has decided to make an exception for one’s terminal leave. In the event that one does not have an employment agreement indicating that one may be eligible for vacation pay upon resignation; such an employee would be an at-will employee. An employer may terminate an at-will employee at any point of time and without any reason. Employer may also reduce the number of work hours or wages, but this should not be done in an illegal or a discriminatory manner. Until such a time that the employee signs a wage modification agreement; is it possible for an employer to hold back the employee’s check?
The employer cannot compel an employee to agree to a different contract by holding back the wages. The employer would be violating Fair Labor Standards Act (FLSA). The wages should be paid to the employee on the payday that has been already set. It is not required that an employee agree to the alterations made to the terms by the employer under any pressure or duress unless the terms are voluntarily agreeable to the employee. Can a company pay few of its employees based on performance base (straight commission) and few others as per the hourly rate plus commission?
It is up to the employer’s discretion to decide on the tasks that need to be performed, hours of work, payment, terms and conditions, etc. Accordingly, the employer may decide on how to pay the employees as long as the employer is not breaching any anti-discriminatory laws, company policies or employment agreements. However, the employer should ensure that an employee, who is being paid straight commission, would get at least the minimum wages. If any employee has previously received two performance based pay hikes, but was fired for a performance related issue now; can this employee file for unemployment benefits?
If an employee was not fired for misconduct, then the employee would mostly qualify for unemployment. Reason such as being late to work or not adhering to company policies would be considered as misconduct. However, the employer would need to prove that the employee knowingly or intentionally ignored the company rules. One may or may not be eligible to receive unemployment benefits as these claims are reviewed on a case to case basis. One should ask an employment lawyer when there is any doubt regarding the compensation paid by the employer.
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