The weeks leading up to a presidential election can be filled with emotion from both sides of the political fence. Presidential candidates look to shore up their respective support bases and suggest changes that might at first seem extreme, such as pushing through healthcare reforms, increasing taxes for individuals or businesses, or increasing regulations on certain industries. The current round of election agendas has covered each of these topics, and business owners that are worried about their implementation have gone on record for saying that they would cut benefits, jobs or both in response to any of these proposed changes.

With that, it may help employees to know their rights. For instance, is it possible for a company to eliminate jobs or cut salaries and benefits due to political retaliation? Below are some of the more important categories.

Right-to-Work Vs. At-Will States
An important distinction between states is whether they are "at-will" or "right-to-work." At-will employees have a much lower level of job protection. Right now, there are an estimated 28 at-will states, and 22 right-to-work states. Employment is as it's stated, and at-will, which means an employer can basically be fired or let go for any reason. This severely limits any rights to fight for wrongful termination, be it because of political retaliation or for any other reason. There are, of course, limited circumstances where an at-will state employee can indeed turn to litigation. In matters of discrimination, taking family or medical leave, or leaving to serve in the military or on a jury, there are certain protections that exist.

A key benefit in right-to-work states is an easier ability to form a union, which is intended to let employees band together and protect their rights against employers. Under union agreements, there can be more clearly defined worker rights, such as pay levels and raises, working schedules and specific terms for being fired or terminated. There are many debates over whether at-will laws or right-to-work ones are the best for employees and employers, but the above general differences do make a difference in worker rights between states.

Pay Minimums
When it comes to the ability for employers to cut or restrict pay, there is much latitude for them to do so. Of course, the federal minimum wage, which is currently $7.25 per hour, sets a floor that employees must pay their workers. The current rate was set on July 24, 2009. States also have individual minimum wage requirements. Beyond this, there are not set amounts on the number of employees a firm may hire, so they can get around overall wage spending goals by simply hiring fewer workers. Overall, it does appear that employers have the upper hand in handing out pay levels, even if they are seen as arbitrary.

Ability to Influence Benefits
When it comes to adjusting employee benefits, there are more restrictions. Generally, it is difficult for an employer to cut pension and related retirement benefits already promised to former workers. For state employees, these benefits may also be considered law that cannot be cut under any circumstances. Employees that have not yet retired can see the current schedule of benefits altered or cut back, though. The ability to change healthcare benefits has become more restrictive since new Federal healthcare regulations have been implemented, but employers still have pretty wide latitude to cut benefits altogether.

The Bottom Line
Overall, employers have the upper hand in terms of being able to fire employees and cut their income and benefits. However, there are certain regulations, such as anti-discrimination measures that are in place to protect workers, but beyond this small subset, employers can indeed make cutbacks or changes in the face of regulations or added costs on their businesses.

Photo Courtesy Lady Buffalo

Related Articles
  1. Entrepreneurship

    7 HR Basics for Small Businesses

    Whether or not you are a fan of human resources, every employer needs to know the answers to these questions.
  2. Savings

    A Quick List of FSA Eligible Expenses

    The ABCs of FSAs: What you can and can't use your Flexible Spending Account funds for.
  3. Investing Basics

    What are the fiduciary responsibilities of board members?

    Find out what fiduciary duties a board of directors owes to the company and its shareholders, including the duties of care, good faith and loyalty.
  4. Entrepreneurship

    How to Start a Business While working a Full-time Job

    Do you have an idea for a business, but are struggling to find the time to launch it? Here's how you can start a business when working a full-time job.
  5. Economics

    The Cost Of Hiring A New Employee

    Hiring a new employee costs a lot more than that person’s salary. Just finding the right person can be pricey.
  6. Economics

    What's a Horizontal Merger?

    A horizontal merger occurs when companies within the same industry merge.
  7. Taxes

    When You Should Change Your Withholding Tax

    Paying attention to your W-4 form, and making adjustments when necessary, is an important way to make sure your tax withholdings are correct.
  8. Investing

    A Breakdown Of Stock Buybacks

    Find out what these company programs achieve and what it means for stockholders.
  9. Personal Finance

    10 Tips for Conducting Effective Meetings

    Sometimes meetings are necessary, but they're often a waste of time. These ten tips can help you conduct effective, productive meetings.
  10. FA

    The Best Way to Staff Up Your Advisory Firm

    Here are some tips to help you make the right hiring decisions, grow your practice and get some of your life back.
  1. Can LLCs have employees?

    A limited liability corporation (LLC) can have an unlimited number of employees. An employee is defined as any individual ... Read Full Answer >>
  2. Do flexible spending accounts (FSA) funds roll over?

    An individual can utilize an employer’s cafeteria plan of employee benefits to establish a flexible spending account (FSA). ... Read Full Answer >>
  3. What protections are in place for a whistleblower?

    Whistleblowers can play a critical role in ensuring the compliance, safety, honesty and legal fairness of governments and ... Read Full Answer >>
  4. How do modern companies assess business risk?

    Before a business can assess or mitigate business risk, it must first identify probable or likely risks to its bottom line. ... Read Full Answer >>
  5. Why has emphasis on corporate governance grown in the 21st century?

    Corporate governance refers to operational practices, management protocols, and other governing rules or principles by which ... Read Full Answer >>
  6. What should a whistleblower do if their employer retaliates?

    Although specifically prohibited by employment law, employer retaliation against whistleblowers for exposing employers' wrongdoings ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Take A Bath

    A slang term referring to the situation of an investor who has experienced a large loss from an investment or speculative ...
  2. Black Friday

    1. A day of stock market catastrophe. Originally, September 24, 1869, was deemed Black Friday. The crash was sparked by gold ...
  3. Turkey

    Slang for an investment that yields disappointing results or turns out worse than expected. Failed business deals, securities ...
  4. Barefoot Pilgrim

    A slang term for an unsophisticated investor who loses all of his or her wealth by trading equities in the stock market. ...
  5. Quick Ratio

    The quick ratio is an indicator of a company’s short-term liquidity. The quick ratio measures a company’s ability to meet ...
  6. Black Tuesday

    October 29, 1929, when the DJIA fell 12% - one of the largest one-day drops in stock market history. More than 16 million ...
Trading Center