My company is ending OT pay, but not OT work

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(MoneyWatch) Dear Evil HR Lady,

Our company just hit us with the news that we are being outsourced as of the end of this month. With that we received an offer letter from our new potential employer, and boy, oh, boy is it not attractive. I was told that if I do not take the offer from the new company that it will be considered my resignation. Interesting, as I did not think I could be forced to resign. I am also told there is no separation package. This leads me to believe that I take this massive step backwards in my career and quality of life or I am tossed out on the street with nothing, not even unemployment. The offer letter keeps my current salary but increases my work day by two hours and decreases my OT from time-and-a-half to straight time.

What am I to do? I do not want to go backwards.

First things first, let's talk about the legalities of the situation.

1. A company can change your pay and/or job description at any time, as long as they do so going forward and not retrospectively (some union contracts place more restrictions on how employers can change a worker's job). That is, they can't say, "Oh, by the way, we lowered your pay for the work you did last week, so your check will be lower." 

2. If you are a non-exempt employee, you must be paid time-and-a-half for any hours over 40 that you work in a week. 

3. If you are in a certain category of information technology worker, you can be paid by the hour, and when you go over 40 they can pay you straight time. There are a couple other situations where you can be paid your straight hourly salary for overtime, but not many.

4. If you say, "I don't wish to do this job, and I'm not coming into work any more," that amounts to a resignation -- even if the reason you are saying it is because the employer changed your work.

5. Unless the company is laying off a significant portion of the workforce, or there is a contract that states otherwise, it is not required to give you severance.

6. You still may be eligible for unemployment because the conditions of your employment changed. However, I would not count on that, as it will vary from state to state, and having your hourly rate staying the same is unlikely to evoke much sympathy from the unemployment office.

Now, let's talk about what you should do. If you're an IT worker, the plan to not pay you time-and-a-half for over time is probably legal, so while unpleasant it's not illegal. If you aren't, I would ask straight out how this complies with the Fair Labor Standards Act (FLSA) and ask them to show you exactly where this is authorized. If they can't, you can file a complaint with your local Department of Labor.

But the overtime pay thing is a small thing. Your thought about just quitting is the big thing. This is dumb. Do not quit because they changed your hours and decreased your pay. You say you don't want to go backwards. How is being unemployed going forward? It's not. And it is much easier to find a new job when you have a job than it is to get one when you are unemployed. Your explanation of why you left won't make people think, "Wow! Good for him for standing up for himself!" They'll think, "That was kind a of bad decision. I wonder what other bad decisions he makes." 

I totally agree that you position under the new company amounts to a massive quality of life change. I don't know too many people who would be happy about adding two more hours to their work day without additional compensation. I sympathize with your desire to get the heck out of there. But don't do so in a snit. Don't quit (or refuse to work the new schedule, which will result in them saying you resigned or firing you for cause). Instead, step up your networking, update your resume, and get out there and try to find a new job.

I imagine that most of your coworkers feel the same way. It's possible that if you all complain together, the company change the policy. But it's more likely that you and your coworkers will quietly find new jobs and leave. And that's what I recommend for you. The last thing you need is no income while you're looking for a new job.

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