Does my employer have to give me a raise?

Employees regularly call Gold Star Law to complain about not having received a raise in pay for years.  We get it- you work hard, and you want to be valued and appreciated for your hard work.  However, there is a big difference between deserving a raise because it is fair and you have earned it, and being legally entitled to an increase in pay.  Although it is nice to get raises all the time, when is your employer actually required, as a matter of law, to raise your pay?

The Fair Labor Standards Act, a federal law that addresses an employee’s right to minimum wage and overtime, requires that all employees who are not “exempt” be paid at least minimum wage for all hours worked.  Certain employees, based on the type of work they do, are not entitled to minimum wage.  The Michigan law, the Workforce Opportunity Wage Act, has similar requirements and exceptions to the rule.  While neither of these laws specifically requires that employees get increases in pay, they do set the minimum pay an employee must receive.  This means that if you are an employee who is paid minimum wage, your rate of pay must go up as minimum wage increases.  In Michigan, the current minimum wage is $9.45 per hour.  In the year 2020, the Michigan minimum wage will be $9.65, and in 2021 it will be $9.87.

In addition to raising an employee’s hourly rate to be at or above minimum wage, another reason an employer may have to give an employee a raise is a contractual agreement.  Some employees have employment contracts with their employers, which set forth the terms of their employment.  Employment contracts often state what an employee must be paid, sometimes including increases in pay over time.  If an employee has an agreement that says the employee is entitled to an increase in pay, the employer must give that raise or it is in violation of the contract.

Similarly, many employees are in unions, which have agreements called Collective Bargaining Agreements with the employer.  Although it is not the employee who is a party to the contract, the Collective Bargaining Agreement can still give the employee rights, including the right to increases in pay.  Union agreements often set forth the rate of pay for certain jobs, including regular increases in pay.

In general, however, employers are not required to give employees raises in pay.  If you are paid above minimum wage and do not have an employment contract and are not covered by a union agreement, chances are your employer has no legal obligation to increase you pay.  This is true even if you take on additional job duties, change job positions, or move to another location within the state.

If you believe that your employer is paying you less than you should be getting as a matter of law, call Gold Star Law for help.