Your employer just informed you that your pay is about to change. Instead of a raise, you are seeing a reduction in your compensation. That sudden shock can be devastating, especially if it comes without any type of warning. Can your employer cut your salary like this?
A variety of factors contribute to an employer’s right to reduce salary. However, if this happens to you for any reason, reach out to a Calgary employment lawyer from JSB Law right away to discuss your case. Call 403-620-5400 for more information related to your situation.
Your Employer Cannot Reduce Your Salary Without Your Consent
In most situations, an employer cannot significantly reduce your salary or any component of your pay without your consent to do so. There are some situations where this may apply.
First, know that an employer may cut compensation by less than 15% without your consent. Anything above this is considered a potential violation of your rights. Yet, it is quite common for this to be a confusing fact of employment law.
Understanding Constructive Dismissal
If you experienced a significant reduction in your salary, you may learn that it is constructive dismissal, which is also called disguised dismissal. This term applies in situations where an employer makes unilateral, significant changes to the terms of your employment contract.
For example, a company may decide not to terminate an employee’s contract but instead to reduce their salary. This may be done, for example, as a way to frustrate the employee into leaving the position. Another example could be the employer drastically changing the job responsibilities, often with a focus on making your job more challenging or requiring more time or effort. Or, the employer in some way creates a hostile work environment. All of these strategies are often done to encourage and even force an employee to quit the position.
To be constructive dismissal, the event that occurred must have been:
- A fundamental change, including any significant reduction in wages, changes in work location, drastic change in work hours, or a change in the type of work the employee does
- Done without the employee’s consent
If a situation occurs, and you believe you were mistreated, it can be critical to seek an employment lawyer to help you navigate the situation. It will be necessary to demonstrate that this was a constructive dismissal. If you can do that, you are then granted the same rights you would have received if you were unjustly dismissed from the position.
Changes to Jobs Must Be in Writing
Under the Employment Standards Code, employers must provide employees with written notice of any substantial changes to their working conditions. This includes any substantial changes to the employment contract related to:
- Wages
- Work hours
- Major aspects of employment
In situations where these changes are substantial and happen without your consent, the employee has the right to resign and then treat the employment as ended for cause, which will then trigger the constructive dismissal actions.
What Can You Do in a Constructive Dismissal Situation?
If you believe your wage cut was substantial (15 to 20% or more) and did not consent to it, take action immediately. This means reaching out to an employment lawyer before doing anything else to determine what your rights are. Document what occurred, when, and how it happened. Then, allow your Calgary employment lawyers to work to build your case.
If you are unsure of your rights, take the first step now by calling JSB Law. Complete our contact form online or call 403-620-5400 to discuss your case.
