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Company takeover, employee rights Illinois

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  • Company takeover, employee rights Illinois

    My company has just been bought out or taken over, I am not really sure, (we are a non-profit mental health agency). We have received letters of offers of employment (by the new company), in which we all received pay cuts, starting over with vacation time and sick time. We are being told that because our old company "floated" our vacation time, we will have to pay back anytime taken we have not earned. I understand this is legal if you quit or are fired, however in a takeover or buyout is that the same? **Edit, this is in Indiana.
    Last edited by parkerjoe9777; 09-14-2010, 06:03 PM. Reason: wrong state

  • #2
    This is legally complicated. By "floated" I am going to assume that you have a negative vacation balance and that the employer either deducted the money or asked you to pay it back (not necessarily the same thing legally). [Not your question but smart employers do not let the vacation/PTO balance to go negative].

    There is technically two different sets of laws in play. I will leave state law (IN?) to someone else (not my state) and address federal law (FLSA) only.
    - If you are non-exempt AND the deduction takes you below minimum wage, then you can make a "free and clear" argument. Your employer will argue that "free and clear" is not involved because the "overpayment" occurred in different workweeks. Then judge/ALJ at this point will scratch his/her head and do what he/she feels like it, because the case law is no longer clear.
    - If you are both exempt and salaried, then you can make an argument that the deduction is a "salary basis" violation and there (somewhere) is a federal DOL opinion letter out there I can eventually dig up that supports this. I do not know what the normal counter argument the employer would use, but there likely is one.
    "Reality is that which, when you stop believing in it, doesn't go away".
    Philip K. **** (1928-1982)

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