Can Employees Turn Down Raises and Promotions?

Although it is not a common occurrence, employees have been known to turn down pay raises and promotions. Employees may not understand the best way to tell their employers this, and in turn, the employers might also be in the dark about handling the situation.

Reasons for Declining

Declining raises and promotions makes financial sense for employees that are dealing with specific circumstances, such as:

• Government Benefits: Employees that earn lower wages often receive government benefits to fill in the gap. A salary or wage increase could push their earnings over the income limit, which could cause their benefits to be reduced or ended. Called the cliff effect, this can also apply to child care vouchers, housing assistance, and other government subsidies. Employers that are in food service, home care, and retail industries usually have lower-paying jobs and need the government support.
• Changes to Employment Agreements: Raises and promotions can have stipulations that necessitate adjustments to employment agreements. These changes may not be acceptable for some workers. If a promotion calls for a new job location, more responsibilities, longer hours, or needing to sign a noncompete agreement, the employee may not be able to accept the offer.
• Divorce, Child Custody, and Child Support: For some employees, increases in pay and benefits will affect alimony, child custody, and support. These individuals may want to avoid raises for these reasons.

Get It in Writing

Employees that wish to decline these offers should put their wishes in writing and sign it; if they do not, the employer should request that they do so. Although there are not any federal laws that force employees to accept raises and promotions, it makes sense to document the circumstances. This way, all parties are protected should either one question or protest what happened. The paperwork can be handled by the company’s Human Resources department.

The documentation should include a statement that the decision is final and will not affect any future wage increases, benefits, or promotions. It may also help to note that these future actions will be based on the worker’s current wages. As for putting down a reason for declining the offer, the employee can simply state that it was for personal reasons. Having a witness there to see the employee sign the document is also important. It should also be mentioned that any employees that participate in collective bargaining agreements will have to adhere to its terms.

Cherry Hill Employment Lawyers at Sidney L. Gold & Associates, P.C. Help Employees and Employers Resolve Work-Related Disputes

If you have questions about preparing, presenting, or handling an employment offer, turn to the trusted Cherry Hill employment lawyers at Sidney L. Gold & Associates, P.C. For a free case evaluation, complete our online form or call us at 215-569-1999. Located in Pennsauken, New Jersey, we serve clients throughout South Jersey.