What to do about a demotiondue toa future medical procedure?

The issue is whether you can 1) continue doing what you need to do to not be demoted  (or not take a lesser position) after the surgury; and 2) if the answer is "no"--the surgery will impair you in some way, either permanently or at least for some period of time, if there is some "reasonable accomodation" which can be made to you to let you keep doing the job as you did. Anti-discrimination law does allow discrimination on the basis of a disability in some cases; the requirement on employers is to make reasonable accomodations, which means to do things which are not too expensive or disruptive in order to let people work. So, for example: say you are a customer service rep who works heavily by phone; knee surgery should not affect you at all, so you should probably not suffer any detriment. Or say you are a field sales rep, who will have some trouble getting around, but if the office adjusts your schedule, lets you make some customer contacts by phone, etc., you can get by...those would be reasonable accomodations and again, you probably should not suffer a detriment. But suppose instead you are a construction supervisor, and due to the knee surgery you cannot safely or effectively get around construction sites, so you can't do the job--then they likely could demote you to a position you could do.

If you feel that you would not be impaired or could be accomodated with a reasonable accomodation, then you may be suffering discrimination and should consult with an employment law attorney.