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Can an Employer Stop Overtime Pay for an Exempt Employee

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  • 08-06-2015, 07:06 AM
    TestDriver
    Can an Employer Stop Overtime Pay for an Exempt Employee
    My question involves labor and employment law for the state of: Michigan

    Hello,

    I've been working for an auto manufacturer as a contract engineer for one year of a two year contract. When I hired, I was told I would be working and be compensated for overtime and have been doing so for the past year and even though I'm supposedly an exempt employee, I've been getting overtime compensated at 1.5 times my computed hourly rate (my contract is per anum). Now, my contract house (Indian firm with US base in NJ) changed their 'policy' and will only pay straight time. When joining this firm, I had to sign a lot of paperwork. One of those was called an Anexures document which stated that if eligible, I would be compensated at 1.5 times regular pay for overtime. My question is, can this 'policy' change be forced on me?

    Thanks.
  • 08-06-2015, 07:12 AM
    Mr. Knowitall
    Re: Can an Employer Stop Overtime Pay for an Exempt Employee
    "Annexures" is a term used in Australia to reference an appendix or attachment to a contract.

    If you are telling us that you were employed under a contract that originally provided for your employer to voluntarily pay you overtime pay, even though you were properly classified as an exempt employee, but that upon proper notice the employer is telling you that prospectively your overtime pay will not be calculated at 1.5 times your 'computed hourly rate', they can do that. As an exempt employee they can also tell you that your base salary is all you get, no matter how many hours you work.
  • 08-06-2015, 07:31 AM
    flyingron
    Re: Can an Employer Stop Overtime Pay for an Exempt Employee
    Annexes are a British thing so it is reasonable to find them in the other commonwealth countries like Australia and India.
  • 08-06-2015, 07:33 AM
    TestDriver
    Re: Can an Employer Stop Overtime Pay for an Exempt Employee
    Quote:

    Quoting Mr. Knowitall
    View Post
    "Annexures" is a term used in Australia to reference an appendix or attachment to a contract.

    If you are telling us that you were employed under a contract that originally provided for your employer to voluntarily pay you overtime pay, even though you were properly classified as an exempt employee, but that upon proper notice the employer is telling you that prospectively your overtime pay will not be calculated at 1.5 times your 'computed hourly rate', they can do that. As an exempt employee they can also tell you that your base salary is all you get, no matter how many hours you work.

    Thanks for your reply.

    In the annexures, the overtime language is "This must be at least 1.5 times the worker‘s regular rate with few exceptions." Is this still a voluntarily situation? Also, can this change of policy facilitate me breaking the contract?
  • 08-06-2015, 08:04 AM
    Mr. Knowitall
    Re: Can an Employer Stop Overtime Pay for an Exempt Employee
    As you were already told, as long as the contract does not prevent a change in wages, your landlord is free to prospectively change your compensation.

    You have told us nothing about the remainder of the contract or the provision you hope to escape, so I suggest having it reviewed by a lawyer to determine if you can resign without triggering the language you hope to avoid.
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