I was reassigned and given a 30% pay cut after being hired to manage a 10-year contract. Does my employer have the legal right to do this?
Wednesday October 28, 2009
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I was hired in November 2007 as a director to manage a 10-year contract. In October 2008, my portion of the contract was rescinded because of lack of funds. I was moved to another business line to assume responsibilities as the administrator and a few months later received a 30% pay cut. Since then, two other employees have been moved to other positions. One employee, a senior vice president with whom the owner had a falling out two days before being moved, also was demoted and given a significant pay cut. Is there anything illegal about this employer moving employees and giving huge pay cuts instead of laying us off? It is my understanding that he was expecting us to quit so he could avoid paying increased unemployment insurance. I’m the only one who is still there.
Robert
The only response that can be given concerning your question is that a nurse attorney or attorney in your state who understands nursing practice and has experience in working with employees who have contracts of employment will need to review your contract to determine if, in your case, what has occurred is acceptable under the contract governing your employment there.
As you are probably aware, the contract(s) you signed would govern how the employer can handle the specifics with your particular employment relationship. Although you did not indicate this in your question, it would be most probably that the initial contract you entered into has a provision or provisions that would govern what would occur if there were financial constraints that affected your initial, and perhaps, subsequent positions. It also is probable that you signed a second agreement that regulates your current position and recent 30% cut in pay.
Unemployment compensation is something your attorney also can discuss with you. It usually is the case that if an employee leaves a position of employment through no fault of the employer’s, the former employee is not eligible for unemployment compensation. Your situation may or may not fall into that exclusion based on how the courts have interpreted this ineligibility category and the specific facts of your situation. Be certain to take your initial, and any subsequent, employment agreement to the attorney so he or she can review it and advise you based on the contract(s).
Cordially,
Nancy
Nancy J. Brent, RN, MS, JD, is an attorney in private practice in Wilmette, Ill. This information is for educational purposes only and is not intended as legal or any other advice. The reader is encouraged to seek the advice of an attorney or other professional when an opinion is needed.
