Company made an offer letter and then 2 months in cut base pay

Question

So I was offered and accepted a job back in August. The offer letter stated I would have a base salary and then be paid a bonus on units sold each week. Then in January they decided to cut the base salary in half. This is a huge change in pay and if I had known this was possible I would have taken a different offer. I continue to work hard and bring in additional revenue but my pay decreases every week. Is there anything I can do or should I just cut my loses and find somewhere else?

Edit

I am in California but the company is based out of Kentucky. Also, the pay cut was universal to all employees nationwide. I now have to make a huge amount of "sales" per day to make up for the cut in base pay. I was also told this is the 3rd restructuring of the pay scale in the last 2 years and older employees made less in base salary than some of us new hires. It all seems very shady. If I had known this was the direction they were headed I would have taken another position

Answer 1

Cut your losses and find somewhere else unless you really, for some reason, want to work with that company. If there are wages you feel entitled to recoup, consult a lawyer. Since we still don't know which country, we also don't know if the change in wage was legal, either.

In the US it would be tricky. IANAL first and foremost. Wage law states that you must be paid the agreed upon rate for work already done. In other words, if you do work thinking you're making $15/hr and your paycheck comes and surprise! They actually paid you $8/hr, then the company is not operating within its rights. On the other hand, if your boss sat down and said henceforth you make $8/hr, you have two options: continue to do work for that rate or quit. Continuing to work for that rate implies you agree to the new pay and you can't expect to recoup any money.

The former may be reason to file a department of labor complaint, but first you could try to resolve internally, especially if you haven't flagged the change as a potential mistake with management or HR. Take control of your money!

Answer 2

Only you can answer this question, because you're much more familiar with the company's internals than anyone else. Factors to think about:

1. Why did they cut your base salary? If it's because of performance, then perhaps you can get it back by improving your performance. However in this case I'd be looking at why your performance dropped in the first place. If you're not interested in the job, perhaps it's time to do something else.
2. Why did they cut your base salary #2: if it's because the company is not doing well, then you'll have to make a hard decision. A country-wide economic crisis for example would mean that you're not likely to get a much better paid job elsewhere since most companies would be struggling. You also have to consider if you like the company and are willing to stick it through with them. If you do and the company folds, you'll likely suffer too, but if the company turns around you'll probably become a highly treasured employee.
3. Why did they cut your base salary #3: if they did so to get you to accept the offer when they made it, intending to lower the salary afterwards, then I'd get out as soon as possible. Integrity is too core to my personal values to make me even consider staying.
4. Can you survive with the lower salary? If so, you have more leeway (such as to stay and hope the company turns around as in #2); if not, you probably want to switch quickly.
5. What's the market rate for a person with your skills? If you're being paid above the market rate even after the cut, then I'd be more inclined to stay. If I'm under the market rate, I'd be more inclined to leave.

Having said all this, I'll add that it's a basic responsibility of the employer to pay his or her employees. If the employer is unable to do this, the employee should have no qualms about leaving.

Answer 3

Then in January they decided to cut the base salary in half.

You don't say what jurisdiction you are in, but the legality of this may be questionable. Normally a job is some kind of contract, and it may be worth checking the terms to see how and why they can do this. If you are in any doubt then consider getting legal advice.

However, legality aside, this is not a good way to treat your employees. It does not show that they value you or are interested in your welfare, and there is no guarantee (or at least none that you have mentioned) that they will not get rid of the other half of the base salary.

I suggest that you show as much loyalty to the company as they have shown to you, and start seeing what other options you have available elsewhere.

A final word of warning. It is quite possible that on finding another position and resigning that you would find that there is an offer to increase your base salary again. This is something many employers do when an employee resigns. Be wary of accepting this offer, your current company has shown that they are trying to pay you as little as they can get away with, this attitude will not change.