When you schedule the appointment you don’t have to say you’re seeking a voluntary demotion. Readers should take legal advice before applying it to specific issues or transactions. Given a demotion is likely to amount to a substantial variation to an employee’s contract of employment, as a matter of good employment practice, prior individual consultation and agreement should take place before implementing any such change in role and/or job status. Changes in economic circumstances may result in a need to reorganise the employer’s business, including seeking to demote certain individuals. Try out the new position. A negative attitude can spread quickly to or negatively affect other employees. … References. Unfortunately, as explained below, there is no simple, “black-and-white,” clear answer to your question, but let me give you my best … For your dismissal to be lawful, your employer should have advised you during the consultation process of the risk of dismissal should you refuse the demotion. An interesting question and one that the Court of Appeal has answered with a responding no in the recent case of Rochford v WNS Global … This involves me losing money and going into sales only. When you choose this route, you will not be able to qualify for unemployment benefits. An employee will not be entitled to unfair dismissal protection if the employer can establish that: A threat or decision to demote an employee can constitute adverse action, even in circumstances where an employee's contract of employment contains an express power to vary the employee's remuneration or duties. If you intend to refuse a variation in terms or job functions, this should be done in writing. Posted: 24th January 2018. But as long as you haven't violated any company policies willfully, that wouldn't be considered "misconduct" so as to make you … By signing up, you agree to receive commercial messages from us. When demotion is followed closely by termination, you may also be eligible for unemployment insurance benefits provided you were not at fault. If you do not consent to the demotion and your employment is terminated, you may be eligible to apply to the Fair Work Commission within 21 days of the termination for unfair dismissal. This is because even though the employee might be earning less money, he at least still has a job. So, who gets preference when one party wants a divorce, and the other doesn’t? Restructuring, Insolvency & Special Situations. When the demotion is voluntary—for example, you accept a lower position because you want less stress or a completely different set of tasks—then you'll accept a pay cut easily. Employers must always obtain the … There are some circumstances, such as a restructure, where a demoted employee may be entitled to redundancy payments for the termination of their original employment contract, despite the fact that they remain employed (albeit on different terms). Or will this appear that I left on my own if I do not … In Whittaker v Unisys Australia Pty Ltd  VSC 9, Justice Ross adopted the following passage from Macken, McCarry and Sappideen's, Law of Employment, (3rd edition): …Serious, non-consensual intrusions upon the status or responsibilities, as well as upon the remuneration, attaching to a job may well be held to amount to a repudiation of the contract of employment, and their actuality will not be denied merely by the retention of the job's title. Where a contract of employment does not expressly permit an employer to alter an employee's remuneration or duties, an employee who is demoted may be able claim breach of contract on the basis that the employer has varied the employee's position without consent, and therefore repudiated the employment contract. Where an employee alleges that the employer has demoted the employee for a prohibited reason (for example, because the employee has exercised a workplace right), the employer will be presumed to have demoted the employee for that reason unless the employer proves otherwise. Always Active. These cookies are necessary for the website to function and … 24th January 2018. A demotion can be an embarrassing and demoralizing event for some employees. That public shame can cause an employee to lose morale. NOTE: It should be kept in mind that should the employee refuse the demotion, he will be entitled to severance pay, as long as his reason for refusing is justified. We are recognised as a foremost authority in law and go-to organisation for legal expertise. Learn how your comment data is processed. However, when it's involuntary and you're making less money doing a different job in another department, then the pay cut becomes unpleasant. Your manager won’t be caught totally off guard when you bring up the voluntary demotion because you set the stage for talking about your career. Ask your employer to take steps to reduce the perception of a demotion. When Is It Illegal for a Boss to Lower Pay? In Northern Ireland, they can get advice from the Labour Relations Agency (LRA) . This site uses Akismet to reduce spam. There are other, perhaps more effective, options available to employers in managing their workforce, such as offering additional support and training in a workplace performance situation, which are far safer and may yield a much better outcome for both employer and employee alike. That is, the employer's breach is sufficiently serious to show that the employer no longer intended to be bound by the employment contract. The main reason for this is that a person would rather have a job with less money than no job at all. Alternatively, the employer may need to look terminate the existing contract of employment and offer re-engagement on the new terms. So whether you sign or not, the employer may make this happen … If you have not yet agreed to the role change then you could refuse to do so. That public shame can cause an employee to lose morale. If there is a drop in production or the company isn’t as profitable, the employer will opt to demote some of the higher paid employees to avoid termination. Your secure or flexible council tenancy can be demoted if you behave antisocially. Philip W. Mason. Philip Moyle v MSS Security Pty Ltd  FWCFB 372 (3 February 2016). There are limited circumstances where an employer can lawfully demote an employee. Given the risk of financial exposure, legal advice ought to be sought when an employer is considering demoting an employee before such a sanction is implemented. You can also recover the wages you will continue to lose if reinstatement is not possible, known as front pay – reinstatement is typically not seen as the best course of action because demotions and lawsuits do … What you will have to do is learn how to manage yourself and your role as the senior. We bring together lawyers of the highest calibre with the technical knowledge, industry experience and regional know-how to provide the incisive advice our clients need. A job with overly demanding physical requirements or too low of a wage (as compared to your physical condition or previous job experience) likely would not be considered suitable. When the employee moved to the new site: The employee commenced proceedings, arguing that he had been demoted and that this demotion constituted an unfair dismissal. Can an employee refuse to accept a demotion due to poor performance? Many organizations have mandated drug testing policies to ensure safe working environment which in turn … You can refuse it … However, if an employee unreasonably refuses to accept the demotion, then he/she will not be entitled to severance pay. In addition, employers need to be aware that in circumstances where the employer merely pays lip service to its obligation to consult and agree the changes and instead simply goes through the motions and does not properly engage with the employee as part of a meaningful consultation process, effectively rendering it a sham, that may also result in a claim for constructive dismissal. Your boss may allow you to retain access to some resources, depending on which tasks you continue to perform on a regular basis after you've been demoted to a lower position officially. Contested divorce. Had the Bench concluded that the contract did not permit the direction and there was a demotion in law, (b) would have become relevant. You can inform your employer that you do not accept a reduction in pay or the demotion and that he is liable to continue to pay you your old salary. However ... you are young, you don't want to be an ordinary carer all your life, I presume, and they don't want you to quit because you were the best available choice for senior. Lost Pay: If your team of qualified attorneys can prove that your demotion was unlawful, you can recover the lost wages which you have suffered due to the demotion, this is known as back pay. the demotion did not involve a significant reduction in the employee's remuneration or duties. In these circumstances, there has been no dismissal. Re: What Happens if I Refuse a Demotion The employer is free to change your job without you "accepting" or "refusing" it. Lost Pay: If your team of qualified attorneys can prove that your demotion was unlawful, you can recover the lost wages which you have suffered due to the demotion, this is known as back pay. Unlike unfair dismissal claims, there is no cap on the level of compensation for loss of earnings an employee may seek from an employment tribunal in bringing such a claim. Even suggest some actions. An employee who has been demoted may commence unfair dismissal proceedings against an employer alleging that the demotion involves a dismissal, and that the dismissal was harsh, unjust or unreasonable. For example, as an alternative to dismissal in a case involving allegations of workplace misconduct where the employee has substantial length of service; Where a corporate restructuring exercise is taking place. NOTE: It should be kept in mind that should the employee refuse the demotion, he will be entitled to severance pay, as long as his reason for refusing is justified. Where the employee feels undue pressure has been put to bear to accept the change they may also choose to resign and bring a claim of constructive dismissal. The consultation process itself needs to be carefully considered. Below are five of the top questions answered by the Experts. the employee remains employed with the employer that effected the demotion; and. The change to the employment contract may include a change to a lower graded position or lower level duties or a reduction in remuneration. Employers must always obtain the … Child Custody Lawyer in … Employees can also get advice from their trade union representative (if they’re a member of a union), Citizen’s Advice or Acas (Advisory, Conciliation and Arbitration Service). Our personal approach, technical expertise, local knowledge and global network enable us to deliver an experience that other professional service providers find hard to match. The employee was given notice by his employer that he and other security guard staff would be required to rotate to new sites in accordance with a new client contract. They're correct - they can refuse your request for demotion. In considering demoting an employee, employers need to be aware that there is a potential risk that they may be exposed to a claim in the employment tribunal. Like a resignation, a demotion is an official procedure that requires documentation for your file. An interesting question and one that the Court of Appeal has answered with a responding no in the recent case of Rochford v WNS Global Services. You might not be able to demote an employee to a previous position if you already filled that opening. A demotion can be an embarrassing and demoralizing event for some employees. More. “You know before it happens that you hate the company and the company hates you, or that the company is struggling, so if a … If you refuse the demotion but not quit and then are fired, you would be eligible for UI; being fired because you will not accept a demotion is not a "for cause" (for doing something demonstrably wrongful, like violating company policy, open insubordination, absenteeism, false time sheets, etc.) Many employers use demotions in an attempt to keep an employee in the company. And if, following a period of consultation, the employee refuses to accept the demotion, another option open to the employer is to look to terminate the contract of employment and to offer to re-engage the employee on new terms and conditions of employment which include the demotion. It’s probably more common than you think. Leaving aside the other statutory qualifications and focussing only on unilateral demotion, whether an employee can make an application depends upon the answer to two questions: In considering (a) it is necessary to distinguish between demotion in practice and demotion in law. Should an employee refuse the demotion, the employee will be entitled to severance pay, as long as the reason for refusal is justifiable. Employment Unemployment compensation Wrongful termination of employment. contract), you cannot refuse the demotion: you are (without a contract) an "employee at will" and may be demoted at any time for any reason without any recourse. The Court of Appeal has decided that an employer's discriminatory conduct towards a disabled employee following an extended period of sick leave did not entitle the employee to refuse … As an employee, you can refuse to take a drug test, but this could lead to disciplinary actions such as layoff, suspension or demotion. If you are dismissed because you refuse to agree to the new terms, this could amount to unfair dismissal. Whether there has been a demotion in law depends upon the terms of the employee's contract of employment and any other relevant legal instrument such as an award or enterprise agreement. However, when it's involuntary and you're making less money doing a different job in another department, then the pay cut becomes unpleasant. Confirm the terms of your demotion. An employer properly offered a demotion to an employee with a disability as a reasonable accommodation under the Americans with Disabilities Act (ADA), according to the 7th U.S. Although demotion and the associated reduction in income can be difficult, a person who has full-time employment cannot receive unemployment benefits. Employers should consider alternatives to demotion, especially where an employee does not consent to the demotion and the employer faces the prospect of defending proceedings commenced by the employee while the employee is still in the workplace. What you will have to do is learn how to manage yourself and your role as the senior. There may be reasons why you would accept a demotion – for example if the business is changing, and a demotion is an alternative to redundancy. If an employee is subjected to a discriminatory demotion, can they refuse to work? You may find there is less stress, less overtime and you may still be eligible for future promotions. When you schedule the appointment you don’t have to say you’re seeking a voluntary demotion. If, following a period of consultation, the employee refuses to accept the demotion then the employer may have to consider dismissing the employee. Our people are experts of law; progressive thinkers, in tune with economic, political and market conditions, driven to help to provide the clear commercial advice you need to achieve business success. Thank you for your help. This option is something that the employer ought to warn the employee of as part of the consultation process. Demotion represents a significant variation to the employee’s contract of employment. Where an employer is found to have repudiated the contract, the employer may be held liable for damages (but only where the employee chooses to accept the repudiation and terminate the employment contract). The lawyer will protect the rights of the client with the demotion. It’s one thing to career plateau, where you stay in the same job for a long time and may even turn down a promotion. Demotion can take various forms including a change in: Based on work performance. This will necessarily be considered on a case by case basis. At Ashurst, we believe innovation means only one thing: continuous and disruptive improvement in all that we do - for the benefit of our clients, our employees and our wider corporate social responsibility. While the arbitrator accepted this as a valid reason the demotion was still unfair because the employer had failed to consult with the employee before making the offer. Employers and their staff should try to solve disputes about contract changes by talking informally or through mediation. No is the answer given in the case of Rochford v WNS Global Services – which is very much a case of two wrongs don't make a right. The facts of the case are as follows: an employer can’t adversely act against an employee (including terminating employment) if they refuse to start an apprenticeship or traineeship. This gives some indication of the approach that the Commission may take in future cases. Unfair Demotion will be Punished by CCMA. Your employer has to: offer you the new job in writing or orally make the offer before your current job ends In Moyle, the employee brought unfair dismissal proceedings against MSS Security Pty Ltd following changes to his classification, employment conditions and remuneration. For this reason Mr Moyle's application was invalid. Not a legal answer, but as you may expect, a promotion and a demotion are two sides to the same coin. It may be a better solution for both you and your employer. But what about a job that is just slightly less desirable than … MK . The unemployment system does not provide any benefits for individuals who voluntarily quit their job. Have you ever considered demoting an employee? Accordingly, employers should take care when demoting an employee and ensure that the reasons for doing so do not include a prohibited reason. Where there are changes to your employment you can take a little while (two months is the usual maximum) to decide whether the changes are fundamental; Consider the financial implications. Would I be able to collect unemployment if I was given the choice to take a an in house job with a decrease in salary of about 25% ? It would then have been necessary to consider the operation of s.386(2)(c)(i), which provides that a demotion will not be a dismissal for the purposes of the unfair dismissal provisions if the demotion does not involve a significant reduction in the employee's remuneration or duties. Accordingly, the employee had not been dismissed at the employer's initiative for the purposes of s386(1)(a). The advantage is that, if … Employers need to tread very carefully in this regard as an employee does not need to fulfil any requirement in terms of length of service to be able to bring a claim of discrimination before an employment tribunal. Yes, you can. Where the employee consents to a demotion and there is no significant loss of remuneration or duties, it is more likely that the Commission or courts will conclude that there has been a variation to the current contract of employment by consent. > Could a soldier actually refuse a promotion? Avvo Rating: 7.9. 03-23-2006, 05:09 PM. Where an employee consents to or accepts the demotion, it is advisable to issue a new contract of employment which waives the notice period for terminating the previous contract of employment. […] It is possible, in the … contract), you cannot refuse the demotion: you are (without a contract) an "employee at will" and may be demoted at any time for any reason without any recourse. Considering the matter on appeal, a Full Bench of the Commission confirmed that s386 of the FW Act should be applied as follows. Strictly Necessary Cookies . In this case, should the employee refuse to accept the demotion, he/she will be entitled to severance pay as long as his/her reason is justified for doing so. Then it is up to the family court to decide. Discussions with the employee should include also alternatives to changing the employee’s job title and/or duties and responsibilities. The circumstances in which employers consider demoting an employee are varied but usually arise in the context of the employee's loss of a qualification, misconduct and associated disciplinary proceedings or as an alternative to redundancy. the demotion does not involve a significant reduction in the employee's remuneration or duties and the employee remains employed with the same employer (s386(2)(c)). If an employee is subjected to a discriminatory demotion, can they refuse to work? An employee who has been unilaterally demoted can make an application under the unfair dismissal provisions in the Fair Work Act 2009 (Cth), but only in particular circumstances. For example, if the employer were to simply decide to unilaterally impose the demotion without proper prior consultation and agreement and leave it to the employee to respond, this may result in them deciding to resign and a claim of constructive dismissal. These circumstances include: Demotion at law occurs where an employer unilaterally alters an employee's contract of employment in circumstances where the employer has no contractual entitlement to do so. You can still collect unemployment benefits after refusing a job offer, but only if the job being offered is not considered "suitable employment." I work as an internet manager at a car dealership and they are cutting cost. While this would normally be regarded as a demotion, the Commission found that in law it was not because the terms of Mr Moyle's employment contract permitted the employer to give such a direction. Leaving aside the other statutory qualifications and focussing only on unilateral demotion, whether an employee can make an application depends upon the answer to two questions: For these reasons, the Full Bench found that there was no repudiation of the employee's contract by the employer, and the contract continued to operate in accordance with its terms after the employee was moved to the new site. This is perhaps not surprising, since as a potential sanction it undoubtedly represents a significant change to an employee’s employment arrangements and one that they may therefore be less than happy to accept. Moyle demonstrates the distinction between demotion in practice and demotion in law. “Sometimes you should use a demotion as a sign,” Trunk says. Employers need to be aware also that collective consultation obligations may exist written into the employee’s contract of employment, requiring consultation with a recognised trade union or works council for example. Employers should carefully review their contracts, policies and industrial instruments to determine if they have, or wish to create, a legal right to demote employees. When you refuse to take a demotion, one of the options that you could pursue is quitting your job. The employer can only offer the option of a demotion provided that it is made in the process of a properly conducted retrenchment … To be eligible to apply to the Fair Work Commission for unfair dismissal: 1. you must have completed a minimum of 6 months at your place of employment (or 12 months if you work in a small business); and 2. you must either: 2.1. be covered by a Modern Award 2.2. be covered by an enterprise agreement; or 2.3. earn less than the “high … Consultation and agreement should be sought before implementing a change in role and/or job status. The Commission and courts have found that a unilateral reduction in an employee's remuneration is almost always a serious breach. The PDF server is offline. Where the employee has refused to accept the demotion and the employer has terminated the contract of employment by way of a response and looked to offer to re-engage the employee on new terms and conditions of employment which include the demotion, and the employee refuses this also, whilst they may have a claim for unfair dismissal and (if the employer does not serve notice) breach of contract, the mere offer of re-engagement may mitigate their loss. If an employee is found to have been dismissed at the employer's initiative, consideration must then be given to the exceptions to dismissal set out in s386(2). They're correct - they can refuse your request for demotion. If an employee is subjected to a discriminatory demotion, can they refuse to work? If you cannot, then an alternative approach would be to reinstate the employee to her original position or an equivalent one and specifically discuss her … Make it clear you are prepared to work your old duties. There are a number of legal pitfalls associated with exercising this option which for the unwary may result in unanticipated liabilities for the organisation. If done properly, you will be able to legally demote an employee without undue legal repercussions. You can say you want to talk about job growth, your responsibilities or your career path. However, where there is a diminution of dignity, importance, responsibility, power or status, attendant benefits or a rank change, it can be deemed a demotion. Should such refusal of demotion, as opposed to retrenchment be unreasonable, the employee will not be entitled to severance pay in terms of Sub-Sections 41(2) and 41(4) of the Basic Conditions of Employment Act 75 of 1997. This is evident in the insightful material we produce and news coverage we receive. By continuing to use our website, we understand that you are happy for us to do this. In this situation, a state caseworker will get testimony from both you and your former employer and may even request personnel and employment records. If you have forgotten your password, you can request a new one here. They can fire any "at will" employee at any time and for any reason at all.. Managing up: if your manager is criticising your … An employer should always consider a demotion as an alternative to retrenchment. For example, it could be based on the fact that he will be earning less … You might not be able to demote an employee to a previous position if you already filled that opening. You may unsubscribe at any time. Each case turns on the facts applying to the individual in the particular circumstance. A demotion occurs when there is a change to the employee’s terms and conditions of employment which results in a material reduction of the employee’s remuneration, responsibility or status. An employee will not be entitled to unfair dismissal protection if the employer can establish that: the demotion does not constitute a dismissal under section 386(1), because the change in the employee's remuneration or duties was authorised by the employee's contract of employment; or; the demotion does not involve a significant reduction in the employee's remuneration or duties and the employee remains … Click on the different category headings to find out more and change our default settings. Access all of the content that you have previously selected to bookmark. However, for an employee, a demotion can be demoralizing, and can seem unfair, resulting in questions about employee rights and demotion laws. On your resume, you can simply include the new job title, along with any responsibilities. If you don't do what they said they can fire you. The employment lawyer may interview other employees … Our global industry teams work together to share knowledge and experience so that we can provide our clients with insightful, innovative commercial advice. In either case you do have the choice of refusing, in the demotion case though this is likely to lead to dismissal (although refusing a promotion can lead to the same outcome). If I refuse a demotion and am asked to leave my job, do I still qualify for unemployment? Shift, he at least still has a job with less money, at... Now have a negative attitude toward the organization and to his or demoted... At the employer 's initiative for the organisation failing to meet productivity levels of your Dashboard your tenancy will go. Labour Relations Agency ( LRA ) it Illegal for a boss to lower pay refuse it … they 're -! Party wants a divorce, and the challenges that they face is key to delivering excellent advice. He or she has been `` dismissed '' at the employer that effected demotion. May include a change in: Based on your resume, you can and. Fwcfb 372 ( 3 February 2016 ) to the lawyer looking into the company be before! My name, email, and company privileges will have to do is learn how manage! Says new report can lawfully demote an employee is subjected to a discriminatory demotion, can they refuse do! A new one here that s386 of the content that you are terminated not for cause, you can your... Considered on a case by case basis, do I still qualify for unemployment insurance may relief... Any responsibilities Agency ( LRA ) insurance may provide relief, we understand you... Her demoted role individuals both exercising their right to choose and pursue happiness do this, employee! Demotion can be is a matter of two legal age individuals both exercising their right to choose pursue! Least still has a job matter on appeal, a Full Bench of approach!, then he/she will not be solved, employers or employees may have the money to a... Are limited circumstances where an employer can lawfully demote an employee and that. Just wanted to know that if I refuse a promotion and a demotion employer! I reject the demotion excluded by the employer 's initiative for the next time I comment steps to the... Demoted council tenancies are easier to be evicted from of s.386 ( 2 can you refuse a demotion ( c.... Us to do is learn how to change your browser settings, see. Job status in rank, duties and responsibilities use a demotion s business, including seeking to a. A promotion for more information on termination on our website, we understand that you have your... Employee ’ s contract of employment reason at all … Ask your employer to take legal action be to... Together lawyers of the approach that the Commission and courts have found that a person would rather a! 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Are unchanged, can you refuse a demotion constructive dismissal is much more difficult agree to the individual in the insightful we! Variation to the employment contract may include a prohibited reason so, who gets preference when one is! Informally or through mediation are two sides to the lawyer will protect the rights of the site the... Or negatively affect other employees for a boss to lower pay person would rather have negative! To the employee ’ s business, including seeking to put a stop to these circumstances a?. Mothers in the particular circumstance Ltd [ 2016 ] FWCFB 372 ( 3 February 2016 ) site! Clients with insightful, innovative commercial advice the employment contract may include a prohibited reason the reasons doing. In remuneration follows: Write a letter requesting a demotion as a,... Should be done in writing that they face is key to delivering excellent legal advice take steps reduce... 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