When you work hard and manage money wisely, credit repair is a smart and realistic goal. But what happens when your work is not met with much-deserved pay? If you’ve been affected by a less-than-responsible employer, keep the following payday blunders in mind. Cash flow is imperative when it comes to effective credit repair. Make sure yours isn’t cut short.
Don’t accept payment:
Via debit or credit.
A Pennsylvania McDonald’s employee recently filed a lawsuit alleging that her employer forced her to receive wages through a JPMorgan Chase Payroll Card to avoid the cost of cutting a paper check. This method of payment came with fees for ATM withdrawals, inactivity, and online transactions. By law, you have a right to the full sum of your wages and should never be penalized for using your own cash. If this is happening to you, don’t help your boss skirt the cost of proper payroll. Demand to be paid by cash or check.
Later than necessary
It’s a tough economy, but that doesn’t mean your boss should cash in on your good graces. If you have been letting payday slide at the request of your boss, it’s time to put your foot down. Ask your employer why your paychecks are arriving late. Explain that although you understand their struggles, your landlord, electric company, and other creditors will not. Assert yourself face-to-face and follow up with a letter or email to provide written documentation of the issue. If your boss continues to pay late, it may be time to move on.
If your boss is in a tight spot, he or she may try to cover their problems by offering an alternative to the standard paycheck. Consider the following example:
Aya works for a small PR firm in New York City. In her spare time, Aya sings and plays guitar in local clubs. After months of recession, Aya’s boss is running out of money. He casually asks Aya if she would be willing to forgo two weeks of payment in exchange for a campaign design to showcase her singing.
Sure, Aya may be interested in a PR campaign, but exchanging her paycheck for another service is unwise. It sets a dangerous precedent, allowing her boss to barter on payday rather than cutting a check. Although Aya could benefit from transforming her hobby into a career, sacrificing her day-job pay is not the way to do it. Take a lesson from her and say no to bargaining. Financial stability requires a reliable income.
In terms other than your agreed contract.
Just as Aya learned, accepting payment outside the scope of your job description is a bad idea. The same goes for accepting payment outside of your contracted agreement:
Victor works full-time as a graphic designer for a mid-level firm. Hired as an hourly employee, his busy schedule allows him to earn an extra $600-$700 per week in overtime. Realizing this, Victor’s boss decides to change Victor’s employee status to salaried, offering the same health benefits, but limiting his ability to earn overtime wages. When Victor receives his paycheck at the end of the month, he is shocked to discover the decrease in his wages.
Victor’s situation is a common one. If you have ever been in a contract-to-hire situation, you understand the pros and cons of salaried vs. hourly wages. Although Victor’s boss was within his rights to change an employee’s status, he must first inform Victor of the decision and draft a new employee contract. The bottom line: An agreement is binding. Circumstances can change, but not without your consent. Take a stand when it comes to supporting yourself. A solid future demands a solid paycheck.