Michigan Company cut terminated employees pay to minimum wage

[SecurityGuy]

Hello,

A colleague, and friend, from the same security company that I work for was terminated three weeks ago (for reasons I'm not provided). Well, last Friday, June 10, was our normal payday. My friend checked his online pay stub and found that the company paid him only minimum wage instead of the $9 per hour he had been getting for the last 15 months.

When my friend contacted corporate about the issue he was told, "the company only pays terminated employees minimum wage for the last pay period times the number of hours actually worked."

Obviously, my friend is upset. I told him to contact the DOL to see if he could file a complaint regarding this, which he said he would do. My question is this. Is there anything else my friend can do?

Regards,
SecurityGuy

[Beth3]

Employers CAN cut an employee's wages. Most States reg's require that an employee be notified in advance before working any hours at the reduced rate. You and your friend should check the employee handbook and see if such notification is in there.

Other than filing a complaint with the DOL, there is nothing your friend can do.

[DAW]

Agreed, although I am going to give a slightly different answer. This is the old common law rule that says rate of pay can be changed on a prospective (go forward) basis. That employers by making a declaration in their manual have meet the prospective requirement. It is not a bad argument but it is not a complete argument. One needs to know if MI has any specific laws/regulations/decisions on this, and if there are any nuance on those rules. For example a decision that some obscure language in the manual is not enough. I am not a MI expert and I have no idea what (if anything) MI thinks on this. I can say that some states want something more definitive, say a document signed by the employee at time of hire spelling this out, so there is no question that the "prospective" requirement has been met.

The other issue is equity. In the 1980s we had a Salaried Exempt employee who worked exactly part of one day. We paid the entire day. He took us to small claims court asking for the entire week, even though federal law (FLSA) and CA law (CLC) both clearly supported our action. He won. We lost. The small claims court judge decided the employee needed the money more then we did. These sort of decisions are not unheard of in small claims court. Not certain, but far from being extremely rare. Federal/state DOL and small claims courts do not always decide these things the same way.

There is a chance, especially if the employers sole support is something in the manual that they cannot prove the employee read that the "prospective" requirement will be deemed to have failed in court.

[Beth3]

He took us to small claims court asking for the entire week, even though federal law (FLSA) and CA law (CLC) both clearly supported our action. He won. We lost. The small claims court judge decided the employee needed the money more then we did.

Unfrickin' believable.

[DAW]

Yes and no. This sort of thing is more common at small claims court then at more formal courts but so called "equity" decisions are not entirely uncommon anywhere. More over, if all we are talking about is a mention in a company manual where the employer cannot prove that the notification has occured, then we have a really big fig leaf for the judge to hide behind. There is nothing in common law that says the manual certainly means that the notification requirement is meet. We simply have employers making such a claim and hoping no one will notice that their fly is unzipped. Employers who know what they are doing get an express written statement signed by the employee up front. Employers who fail to do that are at best guessing at what the courts response will be.

"A judge is a law student who gets to grade his own papers".
H.L. Menken

[Betty3]

DAW, you changed your signature line. I like it.

[HRinMA]

Yes and no. This sort of thing is more common at small claims court then at more formal courts but so called "equity" decisions are not entirely uncommon anywhere. More over, if all we are talking about is a mention in a company manual where the employer cannot prove that the notification has occured, then we have a really big fig leaf for the judge to hide behind. There is nothing in common law that says the manual certainly means that the notification requirement is meet. We simply have employers making such a claim and hoping no one will notice that their fly is unzipped. Employers who know what they are doing get an express written statement signed by the employee up front. Employers who fail to do that are at best guessing at what the courts response will be.

DAW, I like to watch the show People's Court. The judge on it always calls it "rough justice" when she tries to figure out how much someone should pay.