A demotion is a compulsory reduction in an employee's rank or job title within the organizational hierarchy of a company, public service department, or other body.
[1] A demotion may also lead to the loss of other privileges associated with a more senior rank and/or a reduction in salary or benefits.
An employee may be demoted for violating the rules of the organization by a behavior such as excessive lateness, misconduct, or negligence.
Within the continuum of disciplinary options available within most organizations, a demotion falls in the middle range of severity.
At the other extreme, for severe violations of the rules, such as embezzlement or sabotage, an employee will typically be fired and/or the company will file criminal or civil charges.