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The Federal minimum wage provision is laid out by the Fair Labor Standard Act (FLSA). It is governed and enforced by the Department of Labor (DoL) Employment Standards Administration's Wage and Hour Division. On the payday, the wages are required to be paid for the specific pay period. There is a minimum wage rate established by the FLSA. If this is not adhered to and the payment is less than this standard rate; it would be considered illegal. The payment amount may come down due to company policy changes or due to a change in the job profile. This may lead to dissatisfaction amongst employees. Below are a few questions that have been answered regarding hourly wages: Q. Provide details of the federal law with respect to reduction of hourly wages?
FLSA is the federal law that has provisions regarding payment of wages for the time worked. It does not establish a set time when the payment needs to be made; but mentions that the payments should be made at regular intervals (weekly, fortnightly, monthly, etc). If on purpose the payments are delayed; the employers may be levied with damages and interest. The wages that are being paid may be reduced by the employer if there is no employment agreement in this regard. As per the FLSA and the Wages Act, prior notice must be given to the employee before the wages are reduced and prior to the employee working any hours at a particular wage. If there is no notice provided prior to the wage reduction, an employee may claim for the wages due by approaching the state DoL’s Wage and Hour Division. Q. In the state of Alabama is it lawful for a company to pay fewer wages without any change to the job requirement?
If one has an employment contract that clearly indicates that the wages may not be changed; then it would be unlawful for the company to alter the wages. In the event that the employer breaches the terms of the contract, a claim may be filed with the DoL’s Wage and Hour Division. The employer may bring down the wages if there is no such employment contract. However, it should be in line with the minimum wage requirements. It would be illegal for an employer to reduce wages by discriminating against some employees depending on their race, age, disability or membership to a protected class, etc. Q. Is it lawful for a company to reduce the hourly wages citing “performance related issues” as a reason?
If one is an at-will employee, it is legal for the employer to lower the wages. At the same time, it is not required that the duties of the employee are reduced accordingly. The employer should adhere to the minimum wage and overtime regulations set forth by the FLSA. In addition, if there is an employment contract specifying the amount of wages that need to be paid; then the employer has to abide by the contract or the company policy. Resorting to reduction of wages through illegal discrimination will be treated as violation of the law. Q. Consider a situation where employees are working on hourly wages in the state of South Carolina. Can these employees request to be put on the clock for when they are travelling on work? Is it possible to make a claim for back hours if there is such a violation?
Compensation must be paid by the employer, as per FLSA, for out of town assignments and job sites. When an employee goes on an out of town job site; the only time that may be reduced are the hours that an employee may take to commute from home to work. Even if there is no profit; the employer should pay for all the hours. If the employer does not adhere to the guidelines set forth in the FLSA, one may approach the US Department of Labor's Wage and Hour Division. They would go through the data for the past three years and provide those wages as damages. One may also be rest assured that the employer will not terminate the employee for filing such a claim as this would amount to retaliation, which is not allowed by the law. Q. In the state of New York, if an employer asks the employee to report back to work before the mandatory eight hour gap; would the employee be eligible for double pay? This is an employee who works on hourly wages.
The employee will not be eligible for double pay. However, he/she may be eligible to invoke the provision of one hour extra of minimum wage pay according to some situations. In the event that the shift is for 10 hours or more; the employee may be eligible to receive this extra pay at the New York State Minimum Wage hourly wage rate. Q. In the state of California, is it required that a notice be given to the employee before reducing the hourly wage?
In the state of California, employers should abide by the employment contract and the wage reduction may not be imposed without discussing with the employee. One may consult an attorney to file a claim; but the consultation fee may be higher than the wage reduction. Minimum wage laws are followed in many states, but both Federal and State laws need to be adhered to by the employers. In the event of a FLSA claim by an employee; higher of the minimum wages set (as per state or federal law) is given. Under specific circumstances, certain minimum wage exceptions are applied to full-time students and student-learners, tipped employees, those under 20 years in the first 90 consecutive days of employment and workers with disabilities. You can speak to an employment lawyer if you need more information about hourly wages.
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