Ask the ExpertHow much notice should an employee receive if the company is lowering their wage?
hri_Admin Staff asked 2 years ago

Good afternoon, 
We have an employee who started mid October 2020.
Manager wants to lower their wage (doesn’t want to terminate) as they are unable to conduct the work; they are unproductive, struggling to complete their duties.  Manager thinks it is better to have someone rather than have no one in that position.
How much notice should an employee receive if the company is lowering their wage?

1 Answers
Glenn Demby Staff answered 2 years ago

There’s no specific notice requirement for wage cuts under Ontario ESA. Accordingly, the required notice depends on what your contract and HR policies say. If they don’t specify a notice requirement, look to organization practices and notice you customarily provide employees of changes to employment terms. At a minimum, I think employees should get notice of one pay period, although two would be better. Also be careful that your cut doesn’t violate minimum wage requirements or give rise to claims of constructive dismissal keeping in mind that courts and arbitrators are apt to see big cuts, e.g., 20% or more, as crossing the constructive dismissal line.

MIRELLA BENNATI replied 2 years ago

Thank you very much Glenn, this helps.