Do I have legal grounds against my employer?

I was recently demoted from a salaried, full benefits employee to being told if I wanted to stay with the company in any manner I would be a contract (1099) employee. This decision was made 24 hrs after I had notified HR that I had called in sick earlier in the week (one day) due to health issues that I was being treated by a Doctor for anxiety/depression and high cholesterol. I told the HR representative my Doctor had switched some of medications that I take and one of the side effects nausea and overall sick feeling. She emailed my supervisor explaining my absence and the health issues involved. The next day my supervisor had a meeting with me stating that my current salaried position was now going to be an hourly contract position to give me time to 'deal with my health issues'. I will called to work on as needed basis and will receive no benefits. I have had no disciplinary action regarding attendance and have an abundance of PTO hours remaining. His timing seems wrong.