CNN Guest Explains Whether Your Boss Can Cut Your Pay Because You Got Coronavirus Stimulus Check


A CNN viewer asked financial journalist Jean Chatzky if it’s legal for an employer to cut a worker’s pay based on the fact that the worker received a coronavirus stimulus payment, and is therefore “still breaking even.”

Chatzky — who is the financial editor of NBC’s Today Show, an AARP personal finance ambassador, and host of the podcast HerMoney — answered viewer questions about the coronavirus stimulus on Tuesday morning’s edition of CNN’s New Day, and had a mixture of good and bad news for working Americans.

First, the good news. Anchor Alisyn Camerota read a question from a viewer who wanted to know if the stimulus payment would reduce his tax refund for next year.

“It is not. But there is an awful lot of people who believe it is,” Chatzky said, and added that the payment “is not counted as part of your adjusted gross income. You will not have to pay the money back, the government put it out there because they wanted people to be able to put food on the table.”

But then, an unidentified viewer from New York State asked a question that generated less welcome news.

“My employer is lowering my weekly salary due to my receiving a stimulus check. His logic is I am still breaking even. Is this even legal?” Camerota asked on the viewer’s behalf.

“So, we are hearing a lot about paycheck reductions at this point,” Chatzky said, noting “Usually it is the higher paid people at a company, they’re doing it because it’s a way to keep more people on the payroll as we roll through this crisis. ”

“But the bottom line is, it is legal as long as you satisfy a few ground rules,” Chatzky continued, listing those ground rules.

“They have to let you know that you are receiving a salary cut, and you basically have to accept it, you have the right to quit,” she said. “They can’t cut your salary for work that you’ve already done. It can’t be discriminatory. So they can’t say, okay, we’re going to cut the salaries of men, but not the salaries of women. And you have a contract or if you’re a member a union, there has to be some sort of negotiation. They also can’t take you below minimum wage, but other than that, they are allowed to do it.”

Whether they should do that is another question entirely.

Watch the clip above via CNN.

Have a tip we should know?

Filed Under: