Legal Question in Employment Law in Alabama

New company cut pay

I work for a hospital which was non-profit until it was bought out by a for profit health system a year ago. The employees here are paid a certain differentials on top of the base pay rate, but the new company has made pay ''adjustments'' to our differentials. Some employees got increases but others, including myself, recieved cuts. The only problem with this situation is we were never told that we would recieve any kind of paycuts whatsoever. Never signed a new contract agreeing to such pay changes nor ever told that they may possibly occur. Was this practice on the new company's part legal and if so how/why?


Asked on 1/21/07, 3:01 am

1 Answer from Attorneys
Sterling DeRamus Sterling L. DeRamus, Attorney at Law

Re: New company cut pay

There is nothing illegal about cutting pay. It might suck. It might be unfair, but simply cutting pay does not create a cause of action. You are free to vote with your feet and leave.

However, the company cannot cut pay in a discriminatory manner or one that has the effect of discrimination. For example, it cannot cut pay in such a way that only blacks get pay cuts and whites get pay raises. Or women. Or atheists. Or disabled people.

This is true, even if there is no intention to discriminate. So if all the bed pan workers at the hospital were black and it was their pay that was cut, then there'd be a problem.

They also have to pay you minimum wage and overtime as well.

Also, your benefits that have already accrued cannot be touched. So if you have already been vested in your 401K they can't take that away from you.

Hope this helps.

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Answered on 1/24/07, 10:03 am


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