Demoted with 15% paycut & no responsibilities reduced

On Friday 3/20/09, my employer informed me that I was being demoted for poor performance and receiving a 15% rate decrease.

The only time I was advised of poor performance was on 3/12/09 when I was informed I would not be receiving the quarterly bonus (that was due on that day) due to poor performance.

Prior to 3/12, there was not any notification brought to me about poor performance; no verbal discussion and no written warnings.
This May, I will be employed there for 7 years.

When I asked what responsibilities I will no longer have due to the demotion, I was advised that certain responsibilities were already removed and that no more would be taken away.

When those 2 responsibilities were removed (early January & late February) I was not informed the reason was poor performance. I was advised that they need to "make room on my plate" to be able to complete other tasks.

Please advise if these actions are within NYS law.

1 answer  |  asked Mar 22, 2009 08:02 AM [EST]  |  applies to New York

Answers (1)

David M. Lira
Demotion for No Reason or False Reasons

This answer makes a big assumption: You have no written agreement with the employer concerning your compensation.

With this assumption, then the rule under NYS law that would apply is the Employment at Law Doctrine. This rule can be stated in many ways, but here might be stated as follows: an employer can demote you for any reason or no reason at all. An employer can demote you even for a reason which is incorrect or even patently false.

In other words, in your case, there really wasn't any reason for your employer making up a justification of poor performance. It wasn't needed under the employment at will doctrine.

Employers often feel a need to make up a justification because other issues might be at play. For example, let's say that the real reason for the demotion was gender discrimination. In this case, you might be able to sue under federal and state anti-discrimination laws. One way for the employer to avoid liability under these laws is to come up with a legitimate non-discriminatory reason for an adverse employment action. A claim of "poor performance" would certainly be considered a legitimate non-discriminatory reaon for a demotion, but the employee would still be able to challenge the claimed reason, for example showing that the claimed reason was false.

posted by David M. Lira  |  Mar 23, 2009 11:48 AM [EST]

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