Here’s an important note in this rocky economy: Employers are free to change many of the terms and conditions of employment for at-will employees, including changing their compensation.
Recent case: Berkeley Scott took a job with Harris Interactive as a high-level manager. He signed an agreement that set his compensation at $220,000 per year, but which also clearly specified that he was employed on an at-will basis. The agreement said either party could end the relationship at any time, for any legal reason.
Scott apparently didn’t perform as well as expected because he was soon called into a meeting where he learned he would be paid just $150,000 going forward and would have reduced duties.
He kept working for a few days past the date the change took effect and then quit.
Then Scott sued, alleging he was entitled to severance pay, plus his old salary for the days he worked until he quit. He essentially argued that the company breached the employment agreement by changing the terms.
The court disagreed. It reasoned that if the employment was at-will and could be terminated for any legal reason, then the job could also be restructured and so could the pay structure.
Because Scott worked a few days under the new terms, he accepted them and couldn’t claim severance or other termination benefits. (Scott v. Harris Interactive, No. 10-CV-5005, SD NY, 2012)
Final note: Include an at-will clause in your offer letters, any employment contracts and in your employee handbook.
Like what you've read? ...Republish it and share great business tips!
Attention: Readers, Publishers, Editors, Bloggers, Media, Webmasters and more...
We believe great content should be read and passed around. After all, knowledge IS power. And good business can become great with the right information at their fingertips. If you'd like to share any of the insightful articles on BusinessManagementDaily.com, you may republish or syndicate it without charge.
The only thing we ask is that you keep the article exactly as it was written and formatted. You also need to include an attribution statement and link to the article.
" This information is proudly provided by Business Management Daily.com: http://www.businessmanagementdaily.com/30907/when-employee-is-at-will-youre-free-to-change-compensation-going-forward "
- 2009 is 'year of employee benefits'; more in the pipeline for 2010
- DOL teams up with private lawyers to encourage FMLA, FLSA lawsuits
- Counter retaliation claims by accurately documenting every employee complaint
- NLRB adds another wrinkle to arbitration agreement law
- Call lawyer before considering anything like a noncompete--even a gentlemen's agreement