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Unemployment after quitting because of paycut?

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timtamson

Junior Member
What is the name of your state (only U.S. law)? Wisconsin

I am employed at a Wisconsin newspaper that is run by a parent company other than Gannett.

When I was hired in 2007, I signed what was called a "Guaranteed Wage Agreement" that laid out the hourly rate the company would pay me along with the number of hours they would pay me for (45). If I worked more than 45 hours, they would pay me 1.5x normal, and if I worked from 0-45 hours they would pay me for 45. Of course, I almost always ended up working 40 or more, but that's besides the point.

Anyway, I was told last May that I was going to be getting a raise that amounted to close to 10% of my salary. Months passed without hearing anything (when I checked on a bi-weekly basis, they told me it was still an administrative thing), before I finally found out in Sept. that the budgets had been frozen.

Not good, but I soldiered on. Then, in December, the company announced it was making a six percent companywide paycut. I was not happy about this, obviously, but knowing the current job market, I went along and signed the new "Guaranteed Wage Agreement" reflecting the 6% less pay.

Now, on Tuesday, the company announced another 4% companywide cut. This time, I decided it was the last straw. I told my editor that I wasn't going to sign it Tuesday night, then the managing editor Wednesday.

I asked the managing editor, "So, if I don't sign this, you have to fire me? Is that how this works?" The response was, essentially, most likely after a series of warnings to sign the agreement, that yes, I would get fired.

I asked if there were any concessions the company could make, and was told me no. Resigned to my fate, I said that I would work out the rest of my days to the fullest of my ability and when the hammer fell, it fell.

When I got to work today (Thursday), I was immediately whisked into the managing editor's office along with my editor. The ME had talked to HR and payroll, and had a different answer for me than I ever expected in a million years: 1. They were not going to fire me; 2. The Guaranteed Wage Agreement was not a contract, and ultimately they didn't care if I signed it or not; 3. They were still going to cut my pay.

I was completely awestruck and taken aback, I barely knew what to say. I'm still shaken by the shock.

I have a few questions:

1) Is it legal for a company to dock your pay like that when there is an agreement in place? My feeling is that just because it's not labeled a "contract" doesn't mean it's not. If it is legal, is that to say that any business could start paying its employees minimum wage at any time?

2) If I quit, will I have just cause and be able to claim unemployment? I'm guessing the earlier pay issues don't matter, but it's basically a 20% hit I've taken in the past year.

Any help and advice is greatly appreciated.

Thanks much.
 


las365

Senior Member
Take your agreement to an employment lawyer to find out whether the "Guaranteed Wage Agreement" is enforceable.

The claim that you may have that could be lucrative is an overtime claim under the FLSA.
Covered nonexempt employees must receive overtime pay for hours worked over 40 per workweek (any fixed and regularly recurring period of 168 hours — seven consecutive 24-hour periods) at a rate not less than one and one-half times the regular rate of pay. There is no limit on the number of hours employees 16 years or older may work in any workweek. The FLSA does not require overtime pay for work on weekends, holidays, or regular days of rest, unless overtime is worked on such days.
U.S. Department of Labor - Employment Standards Administration (ESA) - Wage and Hour Division (WHD) - Overtime Pay

It's time worked over 40 hours - not 45. You should ask a lawyer about that for sure.

If it is legal, is that to say that any business could start paying its employees minimum wage at any time?
With proper notice, yes.

If I quit, will I have just cause and be able to claim unemployment?
Unlikely, but call your local unemployment office and ask.
 

timtamson

Junior Member
So, just to clarify then: they can change the guaranteed wage agreement at any time and it truly does not mean a darn thing?
 

pattytx

Senior Member
If the OP was nonexempt, sounds like a "salaried nonexempt" arrangement, which is legal and has some exceptions. A colleague has a really good article; I'll get the link and post back.
 

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