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Patrick, Esq.
Patrick, Esq., Lawyer
Category: California Employment Law
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Experience:  Significant experience in all areas of employment law.
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Can a compnay just arbitrarily change the way they pay you?

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Can a compnay just arbitrarily change the way they pay you?

I make a base salary. I enter billing for my work performed into the computer and have the ability to bonus dependent upon the amount of hours I work, similar to OT. Now all of a sudden my company is refusing to pay for certain things they have always paid for. This has resulted in a loss of 59 hours to me for last onth and 19 hours for this month to date. This will translate into a $20000+ loss of pay for me.
Hello and thank you for entrusting me to answer your question. I am extremely sorry to hear of your employment situation.

The answer to your question is that an employer can change the way an employee is paid, provided two conditions are satisfied. First, the employer must provide notice of the change before it can take effect. Otherwise employees do not have a meaningful choice to continue working at the new wage, since the amount of their compensation is determinated after the work is performed. Second, an employer cannot change the way an employee is paid if there exists an employment contract that provides for a specific compensation structure or wage and guarantees it for a specific period of time.

If an employer would not be breaching a contract by changing the way an employee is paid, and if the empoyer provides notice of the change, then the employer can change the way an employee is paid at its discretion.

This tremendous freedom stems from Labor Code section 2922, which provides that employment in the state of California is "at will," absent an agreement to the contrary. Courts have interpreted this to mean that, since an employer retains discretion to terminate employees for no reason, he or she also retains the authority to dictate the terms of employment and change them at any time.

I realize that the law is not entirely in your favor here and I am truly sorry to have to deliver bad news. Nonetheless, I trust that you will appreciate an accurate explanation of the law and realize that it would be unprofessional of me and unfair to you to provide you with anything less.

I sincerely XXXXX XXXXX this information helps you and I wish you the best.

If you do not have any further concerns, I would be very grateful if you would give my answer a positive rating and click submit, as this is the only way I will receive credit for assisting you. If you have any additional concerns that you would like me to address, please feel free to let me know by hitting the REPLY or CONTINUE CONVERSATION button and I will be more than happy to continue assisting you.

Finally, please bear in mind that none of the above constitutes legal advice nor is any attorney client relationship created between us.

Thank you and very kindest regards.
Patrick, Esq. and other California Employment Law Specialists are ready to help you
Customer: replied 3 years ago.

Thank you for your help, I do appreicate your time...


The time I am referring to is time that the company cannot bill to the clients, but has historically paid to the employee. There is nothing in writing about it one way or the other.


There was really no "notice". Just email that said effective immediately they would not pay it.


I understand the "at will" part though.... Frown




Thank you for your reply.

Actually, now as I understand your question, what you describe would NOT be legal because an employer must ALWAYS pay at least minimum wage for all hours in which employees are "suffered or permitted to work," which includes all time in which an employee is under the control of their employer.

If you are under the control fo your employer, you are entitled to be paid regardless of whether that time is billable to a client.

An employer can choose to pay minimum wage for such time but must specifically tell you that is what you will be earning, as noted above. If they try to simply "not pay you" for such hours without specifying that minimum wage shall apply, your ordinarily wage would apply and you would be entitled to pay at that rate for all such hours.

Nonpayment of wages for hours worked is a serious offense and one that the Labor Board takes seriously. An employer can't simply say "we aren't going to pay you because we didn't make any money off you." So, with regard to the hours worked without pay, an individual in your circumstance can file a claim with the Department of Labor Standards Enforcement.

To file a wage claim with the DLSE, visit this link:

Again, I sincerely hope that this information helps you and I wish you the best. If I have answered your question, I would be very grateful for a positive rating of my service so that I may receive credit for assisting you.

Kindest regards.
Customer: replied 3 years ago.

I did make my base pay, well in excess of minimum wage. But, I did work hours that I thought I was going to get paid for that now I am not. It would be like OT pay, and now they are not going to pay it...

I see. In that case, the employer would be free to make the change, provided it notified you of the change in advance of it taking place. I'm very sorry I don't have better news to tell you in this regard.

Thank you very much for your rating of my service, and please feel free to let me know if I can do anything else to clarify my answer or address any further concerns.
Customer: replied 3 years ago.

I appreciate your time....

It's my pleasure.

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