Your boss suddenly reduced your hours after you took leave from work. It feels like a punishment. Can an employer legally reduce your pay as a form of retaliation? The short answer is no. In California, it is illegal to cut someone’s pay or working hours as punishment for exercising their legal rights.
If you believe your employer acted unfairly by cutting your pay, there are ways to file a complaint. At HHJ Trial Attorneys, we understand the frustration of workplace unfairness. So, this blog covers your options and how to prove retaliation on your employer’s part. It also discusses when pay cuts are legal vs. illegal, and what counts as a protected activity that you cannot be punished for.
Can an Employer Cut Your Pay as Punishment?
An employer cannot cut your pay as punishment for exercising your legal rights at work. Some pay reductions are lawful, but they cannot be based on retaliation or discrimination. We discuss the employment laws that govern wage reductions in California below.
When Is a Pay Cut Legal in California?
California is an “at-will” employment state, meaning an employer can legally reduce your pay as they see fit, provided it does not drop below minimum wage. However, they can only do this for future work, not for work you have already done. For example, a pay reduction is legal during planned, company-wide expense cuts or restructuring.
When Is a Pay Cut Illegal in California?
California Labor Code § 221 makes retroactive pay cuts illegal. That means employers can’t reduce your wage for hours you have already worked. Additionally, California Labor Code § 98.6 dictates that a company may not lower your pay for discriminatory reasons or as a form of retaliation against you for filing a workplace complaint.
Can an Employer Lower Your Pay Without Notice?
An employer can not lower your pay without notice in California. They must notify you of the pay cut before you perform any work at the lower rate. Failing to give you advance notice of a rate change violates CA Labor Code § 221 and § 223.
Can an Employer Reduce Your Hours as Punishment?
An employer cannot reduce your working hours to punish you at work; it is illegal under California Labor Code § 1102.5 and § 98.6, which prohibit employers from retaliating against employees for protected actions such as filing a complaint or discussing their wages with co-workers.
That being said, employers rarely label hour reductions as punishments. Instead, they may use neutral language such as “business needs,” “budget adjustments,” or “performance concerns.” In cases like this, the court will look closely at the timing. If your hours were cut right after you filed a complaint, for example, it may imply retaliation.
What Counts as a Protected Activity in California?
Protected activities are actions employees are legally allowed to take without any retaliation by their employers. Cutting your pay or hours because of these activities is illegal.
Reporting Workplace Violations or Safety Concerns
California Labor Code § 6310 protects employees who file workplace health and safety complaints or report accidents, fatalities, or illnesses resulting from unsafe working conditions. Employees are also protected under Labor Code § 98.6 when they report unpaid wages, overtime violations, or missed meal and rest breaks.
Filing a Discrimination or Harassment Complaint
The California Fair Employment and Housing Act (Government Code § 12940(h)) makes it illegal for employers to punish you for opposing or reporting workplace harassment or discrimination. You are protected whether you filed the complaint internally (with HR, for example) or externally.
Requesting or Taking Protected Leave
The California Family Rights Act (Government Code § 12945.2) prevents employers from penalizing employees for taking family care or medical leave. For example, taking leave for the birth of your child, to care for a sick spouse, or to recover from a serious health condition. When you return from leave, you must be reinstated to a comparable position. Your hours or pay rate must not be reduced.
Whistleblowing
California Labor Code § 1102.5 protects whistleblowers who report unlawful activity at their place of work. If you report something that breaks state or federal laws, whether internally or to the police, your employer may not cut your pay as punishment.
Discussing or Asking About Wages
California Labor Code § 232 prohibits employers from requiring employees to keep their wages secret. You have the right to disclose how much you earn to your co-workers and compare paychecks. Punishing you for this is a direct violation of the law.
What Are Your Options If Your Employer Cuts Your Pay or Hours?
If your pay or hours have been illegally reduced, there are ways to pursue relief. California law provides the following avenues for submitting complaints and recovering compensation.
File a Complaint With the California Labor Commissioner
The Labor Commissioner’s Office investigates labor law violations like wage theft and workplace retaliation. You can file a complaint with them online or in person at the local district office. If your complaint is successful, the state can order your employer to pay back the wages you missed out on, reinstate your original hours or hourly rate, or pay a penalty of up to $10,000 per violation (this money goes directly to you).
File a Complaint With the Civil Rights Department (CRD)
The California Civil Rights Department (CRD) handles violations of the Fair Employment and Housing Act. This is the place to file a complaint if your pay or hours were cut because of discrimination. If you plan to file a civil lawsuit for discrimination or harassment, you must file a complaint with the CRD first to receive a “right-to-sue” notice.
File a Civil Lawsuit
Filing a lawsuit can force your employer to compensate you for the wages you lost, along with any emotional distress you suffered because of the sudden pay cut. An employment lawyer can help you collect evidence and build a strong case.
What Compensation Can You Recover?
In an employment lawsuit, you may recover economic damages, such as lost wages and benefits, and non-economic damages, such as emotional distress. In some cases, you may also recover punitive damages under California Civil Code § 3294, plus attorney’s fees under Labor Code § 98.6 and FEHA, the California Fair Employment and Housing Act.
If your employer’s conduct made working conditions so intolerable that you were forced to quit, that may be constructive termination. In that situation, the damages available can increase significantly, including future lost earnings and other compensation tied to the harm you suffered.
When Should You Seek Legal Help for Wage and Hour Violations?
You should seek legal help as soon as the wage or hour violation happens. Under the Fair Employment and Housing Act, the deadline for filing a complaint with the California Civil Rights Department (CRD) is 3 years from the date of the illegal retaliation. However, the longer you wait, the harder it can be to prove your claim. If you choose to file a complaint with the Labor Commissioner instead of going to court, you have a deadline of only one year.
If you’re still not sure whether your employer’s actions were illegal, contact an attorney for their advice. Red flags include pay or hour cuts right after you file a safety complaint, pressure to resign from your boss, and vague language around why your pay was reduced.
How HHJ Trial Attorneys Can Help Protect Employee Rights
Wage retaliation cases require attorneys who can identify the causal link between protected activity and adverse action. HHJ Trial Attorneys is a firm of dedicated San Diego personal injury lawyers with expertise in employment law, harassment, discrimination, and wrongful termination.
We can evaluate your retaliation claim to identify your legal options and, if necessary, litigate if your employer refuses to restore your wages. We handle CRD filings on your behalf and help you meet the tight deadlines imposed by the California Labor Code. Contact us for a free consultation.
