Raleigh, NC asked in Employment Law for North Carolina

Q: Is it legal to switch someone from salary to hourly?

My husband started with a company last year. The company cut his pay 10% due to covid even though their sales have gone up. Then a couple weeks later they switched him to hourly. They said by the 10th of this month he would have his 10% back and now are refusing to raise pay back up. Also, the boss admitted to a designer that they furloughed and brought back that they could quit because he can find people to take much less money now. Is it legal to switch him and to lower his pay. Also, I feel the company is trying to push people out to get cheaper labor

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1 Lawyer Answer
Kirk Angel
Kirk Angel
Answered
  • Knoxville, TN
  • Licensed in North Carolina

A: Yes. It is always lawful to switch a person from salary to to hourly. However, it may not be lawful to switch an employee from hourly to salary. It is also lawful to reduce an employee's wages with a couple of caveats. First, the reduction cannot be below the required amount, i.e. minimum hourly wage for non-exempt employees, minimum weekly salary for exempt employees. Second, it cannot be retroactive, i.e for pay periods already worked. Of course, as a side note, reduction in pay can be unlawful if there is an unlawful motive even if the employer complies with the above, i.e. reduction is due to unlawful discrimination or unlawful retaliation.

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