Cut pay if warranted: It’s OK under FLSA — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily

Cut pay if warranted: It’s OK under FLSA

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in Compensation and Benefits,Human Resources

The Fair Labor Standards Act (FLSA) grants many rights to workers, in­­cluding the right to overtime pay for working more than 40 hours in a workweek. It does not, however, prevent employers from lowering hourly wages if they choose to do so.

Recent case: Eddie Cooper worked for Smithfield Packing in Wilson. Dur­­ing his tenure, he was transferred to the day shift, a move that caused his hourly rate to fall from $12 per hour to $10.56 per hour.

Cooper sued under the FLSA, alleging the wage cut violated the FLSA. The court dismissed his claim. It pointed out that as long as his new pay was still at or over minimum wage, it was the employer’s prerogative to make the change. (Cooper v. Smithfield Packing, No. 5:10-CV-479, ED NC, 2011)

Warning: Reducing wages as rataliation for protected activity is illegal, as are reductions tied to race or other protected characteristics.

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