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I am the HR rep for manufacturing of Personal Protective…

I am the HR rep...
I am the HR rep for manufacturing of Personal Protective Products. Our plant staff have a regular wage and a bonus scheme. Most staff are currently at minimum wage and the bonus is based on anything over 100% production.
If we were to go below 100% are we allowed to reduce their wage if they are above minimum wage. ie. Jennifer worked 80 hours in the pay period. She earns $14.60/hr. Production is only at 97%. Do we have the right to pay her $14.16/hr?
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Answered in 7 minutes by:
3/15/2018
Debra
Debra, Lawyer
Category: Canada Law
Satisfied Customers: 106,082
Experience: Lawyer
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Hello! My name is Debra (formerly known as Legal Ease). Thank you for your question. I'm reviewing it now, and will post back again shortly.

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Would this be a different arrangement from the past or are you asking about new employees?

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Customer reply replied 5 months ago
I am knew to the position, and I have been told by staff that this has happened in the past. It wasn't sitting well with me so I thought I would ask in the event it happens in the future.

It is possible to treat new employees this way in the sense that you can say you get minimum wage and then a certain bonus tied into production.

But you cannot do this to existing employees. That would amount to grounds for constructive dismissal.

When an employer does something that fundamentally changes the nature of the employment so that it drives the employee to quit, this may be a case of constructive dismissal. This is usually the case when the employer reduces wages, cuts hours etc. It is also the case where the employer's conduct makes it intolerable for the employee to continue working.

If an employee does quit under these circumstances then the law is that constructive dismissal is wrongful dismissal and the employer will be liable for damages.

Generally the damages would be equal to what the employee would receive had they been dismissed without cause. If that had been the case they would have been entitled to receive "reasonable" notice or pay in lieu of notice.

Generally, in determining what is reasonable notice Courts look at several factors including the length of time the employee worked for the employer, their age, their position, the likelihood of finding new employment etc.

At the high end, if they were in a managerial position, the Court would likely order one month's notice or pay in lieu of notice for each year of employment. If they were not in a managerial position the Court would order somewhat less.

Does that clarify the law?

Please feel free to post back with any follow-up questions you may have. If you don't have any then I hope I have earned a 5 star rating but if you don't feel that I have please don't hesitate to reply back and let me know what more I can do to assist you. Finally, please know that even after you rate me I will be here for you and you can ask follow-up questions if you think of them later on at no further charge of course.

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Customer reply replied 5 months ago
The bonus system has been in place for years so both old and new employees are on it. I understand if they do not go above 100% production they only get their wage.My question is can we reduce their hourly wage because they didn't make 100%? They have signed contracts stating their hourly wage.

No you cannot. It would be strong grounds for a claim for constructive dismissal.

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Customer reply replied 5 months ago
AS I THOUGHT THANKS!

You are very welcome.

Please be sure to rate me before you leave the site so that I can receive credit for my work.

Thanks and take good care.

Debra
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