Due to the sudden economic turbulence resulting from the COVID-19 pandemic, employers have been exploring ways to temporarily reduce operating costs.  Many employers are seeking alternatives to layoffs.  Such alternatives may include reductions in pay and hours of work, furloughs and shutdowns of operations, and work share programs.  The following identifies the legal and practical considerations associated with the alternatives available to employers.

Reductions in Pay and Hours

An employer is generally free to prospectively change an employee’s rate of pay and scheduled hours.  This can be accomplished by reducing employees’ hours and pay by a proportionate amount.  Employers should consider the following issues and risks before altering work hours and compensation:

Employment Agreements.  Employers must determine whether any employment contracts or offer letters guarantee a level of compensation or set schedule to the affected employees.  Employees with contracts setting forth their level of compensation and work schedule should be notified in writing of the proposed changes.  Employers should be prepared to engage in negotiation on the changes terms in order to minimize the risk of breach of contract disputes.

Click here for the full article.

Print:
Email this postTweet this postLike this postShare this post on LinkedIn
Photo of Cole Lewis Cole Lewis

Cole Lewis is an associate in the Labor & Employment Department.

Cole graduated from UCLA School of Law, where he worked as a law clerk for Public Counsel of Los Angeles and advocated for benefit recipients in the Department of Public Social Services.

Cole Lewis is an associate in the Labor & Employment Department.

Cole graduated from UCLA School of Law, where he worked as a law clerk for Public Counsel of Los Angeles and advocated for benefit recipients in the Department of Public Social Services. He has also previously worked as a summer associate in Proskauer’s Labor & Employment Department.

Prior to law school, Cole received his Bachelor’s degree in Journalism at Indiana University, where he graduated cum laude.

Photo of Elizabeth Dailey Elizabeth Dailey

Elizabeth Ann Dailey is an associate in the Labor & Employment Law Department. Elizabeth assists clients in a variety of labor and employment matters, including motion practice, administrative proceedings, internal investigations, labor-management relations, and claims of employment discrimination. As part of her labor-management…

Elizabeth Ann Dailey is an associate in the Labor & Employment Law Department. Elizabeth assists clients in a variety of labor and employment matters, including motion practice, administrative proceedings, internal investigations, labor-management relations, and claims of employment discrimination. As part of her labor-management relations practice, Elizabeth has assisted in representation proceedings before the NLRB and has experience responding to unfair labor practice charges, conducting labor-related business risk assessments, and assisting with collective bargaining negotiations.

Elizabeth frequently represents clients across a variety of industries and sectors, including educational institutions, sports entities, news and media organizations, entertainment companies, healthcare institutions, and real estate companies.

Elizabeth earned her J.D. from the University of Pennsylvania Law School, where she completed a certificate program in business management from The Wharton School. While attending Penn Law, Elizabeth interned with the National Labor Relations Board Region 2 where she conducted investigations into unfair labor practices and recommended case dispositions to the Regional Director.

Photo of Hannah Morris Hannah Morris

Hannah D. Morris is an associate in the Labor Department and a member of the Employment Litigation & Counseling Group.

During her time at Proskauer, Hannah has assisted in litigation and investigation matters involving workplace harassment, discrimination, and retaliation. She also assists employers…

Hannah D. Morris is an associate in the Labor Department and a member of the Employment Litigation & Counseling Group.

During her time at Proskauer, Hannah has assisted in litigation and investigation matters involving workplace harassment, discrimination, and retaliation. She also assists employers in counseling matters, such as drafting employment handbooks and researching workplace policies.

Hannah earned her J.D. from the University of Virginia School of Law. While in law school, she served as a Research Assistant for Professor Richard J. Bonnie working on matters related to juvenile justice. Additionally, she interned for the Office of the Public Defender for Arlington County and the City of Falls Church.

Prior to law school, Hannah was a Teach for America Corps member teaching Fourth Grade in Eastern North Carolina.

Photo of Jordan Glassberg Jordan Glassberg

Jordan Glassberg is an associate in the Labor & Employment Law Department. Jordan represents employers in a broad array of matters before federal and state courts, FINRA and other arbitration panels, and administrative agencies, including the Equal Employment Opportunity Commission.  Jordan’s practice includes…

Jordan Glassberg is an associate in the Labor & Employment Law Department. Jordan represents employers in a broad array of matters before federal and state courts, FINRA and other arbitration panels, and administrative agencies, including the Equal Employment Opportunity Commission.  Jordan’s practice includes a wide range of labor and employment matters, including employment discrimination, harassment, wage and hour claims, and wrongful termination.  Jordan has assisted in single-plaintiff lawsuits and class and collective actions.  Jordan also provides significant assistance on counseling matters on a wide array of issues.  Jordan has represented clients across many different industries, including financial services, sports, news and media, entertainment, real estate, and healthcare.  Jordan also maintains an active pro bono practice, focusing on assisting asylum seekers and disabled veterans.

Prior to joining Proskauer, Jordan clerked for the Honorable William H. Pauley III in the Southern District of New York.

Before clerking, Jordan graduated from Duke Law School, where he was managing editor of the Duke Journal of Constitutional Law & Public Policy and a member of Duke’s Moot Court and Mock Trial Boards. While at Duke, Jordan received the Labor and Employment Law Award for the Class of 2017, won the Hardt Cup 1L Moot Court Tournament and interned for the United States Attorney’s Office for the District of New Jersey.

Photo of Kramer Rice Kramer Rice

Kramer Rice is an associate in the Labor & Employment Law Department and a member of the firm’s Employment Litigation & Arbitration, Class & Collective Action, Wage and Hour, Sports Law, and Appellate Groups.

Kramer represents and counsels clients in all aspects of…

Kramer Rice is an associate in the Labor & Employment Law Department and a member of the firm’s Employment Litigation & Arbitration, Class & Collective Action, Wage and Hour, Sports Law, and Appellate Groups.

Kramer represents and counsels clients in all aspects of labor and employment law. He regularly defends employers before state and federal courts and administrative agencies in single and multi-plaintiff actions concerning discrimination, harassment, retaliation, wage and hour, union contract, and restrictive covenant disputes. To this end, Kramer has represented client interests before numerous state and federal courts of appeal. Kramer’s representations span an array of industries and organizations, such as sports leagues and teams, law firms, financial institutions, colleges and universities, media groups and energy companies.

Kramer also maintains an active pro bono practice involving both domestic and international issues.

While in law school, Kramer interned with the in-house group at Viacom Media Networks. He also was a member and published author in the Notre Dame Law School Journal of Legislation and served with distinction on the Jessup International Moot Court Team.

Photo of Steven J. Pearlman Steven J. Pearlman

Steven J. Pearlman is a partner in the Labor & Employment Law Department and Co-Head of the Whistleblowing & Retaliation Group and the Restrictive Covenants, Trade Secrets & Unfair Competition Group.

Steven’s practice covers the full spectrum of employment law, with a particular…

Steven J. Pearlman is a partner in the Labor & Employment Law Department and Co-Head of the Whistleblowing & Retaliation Group and the Restrictive Covenants, Trade Secrets & Unfair Competition Group.

Steven’s practice covers the full spectrum of employment law, with a particular focus on defending companies against claims of employment discrimination, retaliation and harassment; whistleblower retaliation; restrictive covenant violations; theft of trade secrets; and wage-and-hour violations. He has successfully tried cases in multiple jurisdictions, and defended one of the largest Illinois-only class actions in the history of the U.S. District Court for the Northern District of Illinois. He also secured one of only a few ex parte seizures orders that have been issued under the Defend Trade Secrets Act, and obtained a world-wide injunction in federal litigation against a high-level executive who jumped ship to a competitor.

Reporting to boards of directors, their audit committees, CEOs and in-house counsel, Steven conducts sensitive investigations and has testified in federal court. His investigations have involved complaints of sexual harassment involving C-suite officers; systemic violations of employment laws and company policies; and fraud, compliance failures and unethical conduct.

Steven was recognized as Lawyer of the Year for Chicago Labor & Employment Litigation in the 2023 edition of The Best Lawyers in America. He is a Fellow of the College of Labor and Employment Lawyers.  Chambers describes Steven as an “outstanding lawyer” who is “very sharp and very responsive,” a “strong advocate,” and an “expert in his field.” Steven was 1 of 12 individuals selected by Compliance Week as a “Top Mind.” Earlier in his career, he was 1 of 5 U.S. lawyers selected by Law360 as a “Rising Star Under 40” in the area of employment law and 1 of “40 Illinois Attorneys Under Forty to Watch” selected by Law Bulletin Publishing Company. Steven is a Burton Award Winner (U.S. Library of Congress) for “Distinguished Legal Writing.”

Steven has served on Law360’s Employment Editorial Advisory Board and is a Contributor to Forbes.com. He has appeared on Bloomberg News (television and radio) and Yahoo! Finance, and is regularly quoted in leading publications such as The Wall Street Journal.

The U.S. Chamber of Commerce has engaged Steven to serve as lead counsel on amicus briefs to the U.S. Supreme Court and federal circuit courts of appeal. He was appointed to serve as a Special Assistant Attorney General for the State of Illinois in employment litigation matters. He has presented with the Solicitor of the DOL, the Acting Chair of the EEOC, an EEOC Commissioner, Legal Counsel to the EEOC and heads of the SEC, CFTC and OSHA whistleblower programs. He is also a member of the Sedona Conference, focusing on trade secret matters.