Salary decreased without consent by employee

[czknani]

I work in NJ as a Real Estate Title Officer (Settlement Clerk) When on 8/23/04 an article appeared in the paper and in the news about salaried persons should receive overtime, my company panicked, because we usually work about 70 hours a week. We do receive $50 for every closing outside business hours (9-5). (About 5 to 6 closing a week)
My company decided they must pay us overtime and eliminated the $50 fee we received. They said in order to pay us overtime, we were no longer exempt employees, but hourly. They reduced our hourly wage by $3 an hour. Is this legal. Thanks for your reply, I don't know who else to ask...!

 

[cbg]

I don't know if you are the same person that I responded to a similar question elsewhere, but if you are you've provided more information in this post that you did in the first one.

Nonetheless, it still does not appear that your employer has violated any laws.

First of all, the article you refer to is just plain wrong. (I'm going to assume for the moment that you are the same person, and that the article you refer to is one that says that a 'salaried' employee who is not in sales or does not have authority to hire and fire, most likely is due overtime. If you are not, please clarify.) That is not correct. First of all, salaried and exempt are not interchangeable terms. An employee who is correctly classified as exempt is not under ANY circumstances entitled to overtime. Period. What's more, it is NOT a requirement that the employee be in sales or have the ability to hire and fire before they can be classifed as exempt. There are a number of possible exemptions; executive, administrative, professional, sales, and computer. The ONLY one of these possibilities where ability to hire and fire is a requirement, is the executive. It is ENTIRELY possible to be exempt without managing or supervising other employees and/or having the ability to hire and fire them.

While it is possible for an non-exempt employee to be paid on a salaried basis when they work 40 hours or less, and paid OT if they work more than 40 hours in a week, it is a GROSS exaggeration to claim that "most" employees who are paid on salary fall into this category, or even that they should fall into this category. I'm sure that there are SOME employees who were misclassifed, or whose classification changed with the change in the law on 8-23-04, but to claim that this affected MOST employees was a manipulation of the truth as certain groups who opposed the change in law attempted to prevent it. So your employer may have panicked for nothing.

However, under both the old law and the new, even if an employee qualifies to be paid on an exempt basis, they may legally be paid on a non-exempt (hourly) basis. Nor does the law require that they get your permission first. In fact, if any of the employees whose status was changed WERE affected by the new law (which is possible - I'm not saying your employer was wrong to make the changes, only to believe an article saying that MOST employees were misclassified) then they were required by law to make that change whether they had your permission or not.

Additionally, nothing in the law prohibits your employer from lowering a wage or salary. Depending on your state law they MAY have been required to give you advance notice (although it sounds as if they did) but barring a genuine, bona fide contract that specifically states otherwise, lowering a wage or salary is not illegal as long as any state laws regarding notice (there are no Federal laws requiring advance notice) are complied with. To the best of my knowledge (although I could be mistaken on this point - I've never had occasion to specifically research NJ law on this issue) New Jersey has no particular notification requirements and as long as you are notified in advance of working any hours at the lower rate, your employer is legal. This means they could post a notice over the time clock saying, 'Effective today the new wage is xxx" and that would be legal.

And finally, as above unless you have a genuine, bona fide contract saying otherwise, your employer is free to eliminate the $50 "bonus" for the off-hours closing. Regardless of whether you are considered exempt or non-exempt, the law does not require them to provide this. If you are exempt, there are no circumstances whatsoever under which your employer is required to pay you anything over and above your regular salary. If you are considered non-exempt, your employer is required to pay you for every hour worked and pay you OT at the rate of time and a half for every hour over 40 in a week, but they are not required to pay a bonus for closings after hours.

Sorry I can't give you a better answer.

 

[czknani]

Thank you very much. Yes, I am the same person. I appreciate the clarification, although I wish the answer was different!