Category: Wrongful Termination

In the U.S., most workers are employed at-will. This means that they can be fired or let go from a company for almost any reason except whistleblowing or discrimination.

However, questions remain if you are still employed but your employer chooses to demote you instead of firing you. Is this legal? Can companies in California demote you for any reason or do they need to show why you are being demoted? Are there any forms of illegal demotion? If you are illegally demoted, what should you do?

Who can be demoted?

A demotion is when an employer lowers an employee’s status and gives them fewer responsibilities, less pay, and fewer benefits. They may also change the employee’s title or completely change their job description. Demotions often occur after an employee has had a poor performance review or when an employer is unhappy with the work that has been done.  

California is an at-will state so employees can be let go from their job for almost any reason. The at-will status also applies to demotions and an employee can be demoted without cause. This means that your employer can demote you for almost any reason. In practice, most employers are wary of possible future lawsuits and only demote employees when they have a reason.

Your employer also has the right to alter your position. This is usually done when there is a company restructuring or new employees are hired who have specific experience. While not exactly a demotion, your employer is within their right to change your job title, alter the description of your job duties, or even lower your salary.

What employees are protected from demotion?

A wrongful demotion occurs when an employer demotes their employee for unlawful or unwarranted reasons. A demotion may be unjustified if you have a written or implied employment contract with your employer. The contact may have certain stipulations as to your job duties and salary. It may also have express or implied protections that your position and salary will not change. If this is the case, you may have a wrongful demotion case.

An employer cannot break federal or state discrimination rules when demoting an employee. Federal discrimination laws are enforced by the U.S. Equal Employment Opportunity Commission (EEOC). These laws make it illegal to fire or demote someone on the basis of age, race, disability, genetic information, national origin, pregnancy, gender, and religion. An employee can also not be demoted as a form of retaliation or harassment.

California discrimination laws are some of the most comprehensive in the country. They are defined in the Fair Employment and Housing Act (FEHA) and enforced by the Department of Fair Employment and Housing (DFEH). Discrimination prohibitions are similar to those in federal law but California does expand some protections. For example, it is illegal to fire or demote someone in California based on their sexual orientation.  

What should you do if you are demoted?

If your demotion is not protected by an employment contract and there was no discrimination or harassment, you may still have options. You can always make an appeal with your companies Human Resources department.

Ask them for the specific reasoning for your demotion and find out what steps need to be taken to appeal the decision. If the demotion cannot be undone, request information on what needs to be done, if possible, to work your way back to your previous position and pay.

If you were demoted based on discrimination, it may be best to seek an employment attorney. They can help you sort through which state or federal laws apply. They can also refer you to the right government agency to file a complaint. They can also seek resolution through arbitration or mediation. Finally, if necessary, an attorney can bring your case to court to fight your wrongful demotion.

You can request several things if it is determined that you were wrongfully demoted. These include back pay and lost benefits. For example, you may be able to seek compensation if your benefits were taken away during your demotion but you had an emergency that previously would have been covered.

You can also request that your employer pay your attorney’s fees and you may be able to claim pain and suffering. A demotion and loss of pay and benefits can be extremely stressful. If you suffer anxiety or depression because of your demotion, you may be able to seek some compensation from your employer to cover any negative effects.