Labor & Employment Law Daily Wrap Up, DISCRIMINATION—NATIONAL ORIGIN—S.D. Ill.: Questions remain in case of South African manager who suffered salary reduction, (Jul 27, 2026)

By Ursula Furi-Perry. J.D., MBA

The employer offered a legitimate, nondiscriminatory explanation: it lost its sole customer and reduced managerial salaries to lower expenses.

A South African employee who alleged that his promised salary was significantly reduced shortly after he relocated to the United States was not entitled to summary judgment on his federal and Illinois law national-origin discrimination, FLSA unpaid wage, breach-of-contract, promissory estoppel, or fraud claims, a federal district court found. Factual disputes remained as to most claims, and the plaintiff had not otherwise established entitlement to judgment as a matter of law. The employer also offered a legitimate, nondiscriminatory explanation for the salary reductions: it lost its sole customer and reduced managerial salaries to lower expenses (Van Dyk v. VEA Telecoms USA Co., No. 25-cv-00905-JPG (S.D. Ill. July 22, 2026)).

Relocation to U.S. The plaintiff, a South African citizen, initially worked for a South African subsidiary of the same corporate group as the defendant VEA Telecoms USA. In spring 2023, VEA anticipated substantial telecommunications projects in North Carolina, South Carolina, and Georgia from Open Fiber USA, its sole customer. Because the plaintiff possessed relevant experience and skills, VEA offered him an Operations Manager position in the United States with an annual salary of $144,000, paid in monthly installments of $12,000. Before accepting, the plaintiff asked whether VEA would provide relocation assistance, employ his wife, and increase his monthly salary to $13,000. A company representative responded that $6,000 was intended to help employees settle in after arriving, that VEA wanted to give his wife an opportunity to work for the company, and that the company would maintain the offered salary. The plaintiff accepted and moved with his family to the United States in September 2023.

Employer lost only customer. In October 2023, however, Open Fiber terminated its relationship with VEA. Because Open Fiber was VEA’s only customer, the employer lost nearly all meaningful work and sought to reduce operating expenses. VEA reduced the salaries of its managerial employees, most of whom were South African. It did not reduce the compensation of its hourly laborers, none of whom were South African. Unlike the managers, however, hourly employees performed manual labor and did not receive benefits such as rental vehicles or housing and meal allowances.

Salary reduced. Although VEA had promised the plaintiff $12,000 per month, it paid him between $5,000 and approximately $6,963 per month from October 2023 through February 2024.

Resignation and salary demand. The plaintiff resigned in March 2024 and demanded payment of the outstanding salary. VEA initially stated that it lacked the funds to establish a payment plan but later paid him $21,116.81, which it characterized as the full amount of his salary reduction. The plaintiff then sued in the U.S. District Court for the Southern District of Illinois, asserting national-origin discrimination, FLSA wage violations, breach of contract, promissory estoppel, and fraud. The plaintiff then moved for summary judgment on all claims.

National origin. The court analyzed the national-origin discrimination claims under the familiar McDonnell Douglas burden-shifting framework. The central question was whether a reasonable factfinder could conclude that the employer reduced the plaintiff’s salary because of his South African national origin. The court found at least two material factual disputes that prevented judgment in the plaintiff’s favor: first, the plaintiff compared himself to VEA’s hourly employees, whose compensation remained unchanged and who were not South African; however, those employees did not appear similarly situated to him. They performed manual labor, received hourly wages, and lacked the housing, meal, and vehicle benefits available to managerial employees. Second, VEA offered a legitimate, nondiscriminatory explanation for the salary reductions: it lost its sole customer and reduced managerial salaries to lower expenses.

FLSA. In his FLSA claim, the plaintiff argued that VEA violated the law by paying less than the promised monthly salary. The court explained, however, that the FLSA does not generally enforce contractual salary promises; it requires payment of at least the federal minimum wage. Because the plaintiff did not properly establish the number of hours he worked, the court assumed a standard 40-hour workweek. Even his lowest monthly payment of $5,000 equaled approximately $31.25 per hour, well above the federal minimum wage, the court explained, and the plaintiff therefore failed to establish an FLSA violation as a matter of law.

Contract claim. Regarding the breach of contract claim, the court found a factual dispute over whether the parties formed an enforceable employment contract. The plaintiff relied on his offer letter and email communications promising a $12,000 monthly salary. However, offer letters and employment-related emails do not automatically create enforceable contracts under Illinois law, particularly in an at-will employment relationship. Because the record did not conclusively establish a valid contract, the court denied summary judgment on this claim.

Promissory estoppel. On the promissory estoppel issue, the court found evidence that VEA unambiguously promised the plaintiff a $12,000 monthly salary and that he relocated from South Africa in reliance on that promise. The statements concerning relocation assistance and employment for his wife were less definite and did not clearly guarantee either benefit, yet even as to the salary promise, factual disputes remained and prevented summary judgment: a jury could find the plaintiff’s reliance unreasonable because VEA offered at-will employment that it could terminate at any time, or that he suffered no remaining detriment because VEA later paid him $21,116.81 to compensate for the salary reductions.

Fraud. Finally, in his claims for fraud, the plaintiff failed to establish that VEA knowingly made false statements when it offered him the position. VEA extended the offer in May 2023, months before it unexpectedly lost its sole customer in October, which could allow a jury to find that VEA genuinely intended to pay the promised salary when it made the offer and reduced compensation only after its financial circumstances changed.

The case is No. 25-cv-00905-JPG.

Judge: Gilbert, J.

Attorneys: Samantha Ann Koempel (Spielberger Law Group) for Karel Van Dyk. Stephanie Cohan Fredman (Thompson Coburn) for VEA Telecoms USA Co. d/b/a VEA Connect.

Companies: VEA Telecoms USA Co.; VEA Connect

Cases: NationalOrigin Discrimination WageHour MinimumWage TortClaims ContractClaims IllinoisNews