In most jobs, employers are not required to give raises. Pay increases, cost-of-living bumps, and performance bonuses are discretionary decisions the employer makes on its own terms. But that default has real exceptions. A written contract, a union agreement, a minimum wage increase, a prevailing wage determination on a government project, an overtime rule change, or a finding of pay discrimination can each create a legal obligation to raise your pay.
The Default Rule Under At-Will Employment
Most American workers are employed at will. Either side can end the relationship at almost any time for almost any reason, as long as the reason isn’t illegal.1LII / Legal Information Institute. Employment-At-Will Doctrine That flexibility runs through compensation too. An at-will employer can set your pay, hold it flat for years, or adjust it upward whenever it chooses. There is no federal statute that says another year on the job earns you a raise.
Good work, added responsibilities, or long tenure don’t create a legal right to more money on their own. Your employer can say no, and that refusal by itself is not grounds for a lawsuit. The exceptions below are narrow, but where they apply, they are enforceable.
When a Contract or Union Agreement Requires a Raise
The at-will default falls away once a binding agreement fixes pay terms. If your individual employment contract schedules salary increases, annual cost-of-living adjustments, or performance-triggered raises, the employer has to honor them. Skipping a promised raise is a breach of contract, and you can sue for the difference.
Union-negotiated agreements are the more common version. A collective bargaining agreement usually spells out wage scales, seniority-based step increases, and automatic adjustments at set intervals. Federal labor law treats these agreements as binding, and once a union is the exclusive bargaining representative, the resulting agreement governs wages for everyone in that bargaining unit.2National Labor Relations Board. National Labor Relations Act The employer must follow the negotiated pay schedule.
A verbal promise can occasionally be enforced through promissory estoppel, which applies when you relied on a clear promise to your detriment, such as turning down another offer because your boss guaranteed a raise. Courts demand strong evidence of a specific promise and concrete reliance, so these cases are hard to win, but they do succeed in the right facts.
Minimum Wage Increases Force a Raise
When the minimum wage that applies to your job goes up, any employer paying below the new floor must raise affected workers to at least the new rate. That is a legally required raise, and it happens more often than many people realize.
The federal minimum has held at $7.25 per hour since 2009.3U.S. Department of Labor. State Minimum Wage Laws Federal law expressly does not override any state or local law setting a higher minimum, and employers must pay whichever rate is highest.4Office of the Law Revision Counsel. 29 USC Ch 8 Fair Labor Standards – Section 218 Relation to Other Laws So if a city raises its minimum to $16.50 and you were earning $15.00, your employer has to move you to at least $16.50.
Roughly 19 states and the District of Columbia now index their minimum wage to inflation, usually through the Consumer Price Index.5National Conference of State Legislatures. State Minimum Wages In those places, the floor rises on a predictable schedule without new legislation. If you earn at or near the minimum in an indexed state, you receive a required raise each year even if no one reviews your performance.
Prevailing Wage Rules on Federal Contracts
Workers on federal government contracts sit under wage floors that shift over time and can force raises during a project.
On federal public works construction projects worth more than $2,000, contractors must pay laborers and mechanics at least the locally prevailing wage set by the Secretary of Labor.6General Services Administration. FAR 22.403-1 Construction Wage Rate Requirements Statute Those determinations are updated annually and revised as new survey data comes in. When a contract is extended or expanded in scope, the contractor has to incorporate the current wage determination, which can mean higher pay for every worker on the job.
Federal service contracts over $2,500 fall under the Service Contract Act. On multi-year contracts, wages must be adjusted at least once every two years based on updated prevailing wage determinations.7eCFR. Part 4 Labor Standards for Federal Service Contracts The adjustments are not optional. If the determination for your job classification goes up, your employer must match it.
The Overtime Exemption Salary Threshold
Federal overtime rules can force a raise indirectly. To keep a salaried employee exempt from overtime, an employer has to pay at least the minimum salary threshold set by the Department of Labor. When that threshold rises, the employer has to either bump the salary to the new floor or reclassify the worker as non-exempt and start paying overtime.
The current threshold is $684 per week, or $35,568 per year.8U.S. Department of Labor. Earnings Thresholds for the Executive, Administrative, and Professional Exemption The Department tried to raise it in 2024, but a federal district court vacated that rule in November 2024, and the 2019 thresholds remain in effect. The current total annual compensation threshold for highly compensated employees is $107,432. If a future rule or court ruling raises either figure, employers will have to give affected workers a raise or begin tracking their hours and paying overtime.
Pay Discrimination Can Result in a Court-Ordered Raise
When an employer has been paying you less because of your race, sex, religion, color, or national origin, the remedy often includes raising your pay. This is one of the few settings where a court or agency can order your employer to increase your salary.
The Equal Pay Act requires equal pay for equal work, meaning jobs demanding the same skill, effort, and responsibility performed under similar conditions. It bars employers from closing the gap by cutting anyone else’s pay, so compliance means raising the underpaid worker.9U.S. Equal Employment Opportunity Commission. Equal Pay Act of 1963 Title VII of the Civil Rights Act covers compensation discrimination based on race, color, religion, sex, and national origin more broadly.10Office of the Law Revision Counsel. 42 USC 2000e-2 Unlawful Employment Practices
Along with back pay and other damages, the EEOC or a court can order the employer to equalize pay going forward, which functions as a mandatory raise.11U.S. Equal Employment Opportunity Commission. Remedies for Employment Discrimination
Your Right to Ask and to Talk About Pay
Most employers don’t have to give raises, but you have strong legal protections when asking for one and when comparing pay with coworkers to build a case.
The National Labor Relations Act protects employees’ right to engage in “concerted activities” for mutual aid or protection.12Office of the Law Revision Counsel. 29 USC 157 Right of Employees That covers discussing your wages with coworkers, comparing salaries, presenting group requests for better pay, and contacting a union. An employer cannot punish you for those conversations, interrogate you about them, put you under surveillance, or maintain a policy prohibiting wage discussions.13National Labor Relations Board. Your Right to Discuss Wages Workplace “pay secrecy” rules are illegal under federal law, whether or not employees are unionized.
Separate protections apply when you file a formal wage complaint. The FLSA prohibits retaliation against any employee who complains about wage violations, participates in an investigation, or testifies in a related proceeding, whether the complaint is oral or written, internal or filed with the government. A worker who suffers retaliation can recover lost wages plus an equal amount in liquidated damages.14U.S. Department of Labor. Fact Sheet 77A Prohibiting Retaliation Under the Fair Labor Standards Act
Can Your Employer Cut Your Pay Instead
The flip side of no required raise is that most employers can reduce pay going forward, though never for hours already worked. A majority of states also require advance written notice before a reduction takes effect, and the new rate can never drop below the applicable minimum wage. If your pay is set by a contract or collective bargaining agreement, the employer cannot cut it unilaterally at all.
Some employers respond to raise requests by reminding workers they could be paid less. That is technically true for at-will employees, but a pay cut triggered by protected activity, such as filing a wage complaint or discussing pay with coworkers, is retaliation and opens the employer to damages under the same laws that protect the conversation in the first place.