Reported speech is used to tell somebody what another person says or said. There are various different reporting verbs, e.g. say, tell, mention, point out, argue, complain, etc.
In case the reporting verb is in PRESENT TENSE, only the person of the reported speech changes. However, if the sentence starts with a reporting verb in PAST TENSE the person as well as the tense of the reported speech need to be changed. Have a look at the following examples:
PRESENT TENSE:
Direct Speech: Mary tells me, "I am working in a restaurant."
Reported Speech: Mary tells me that she is working in a restaurant.
Explanation: The PERSON has changed: I has turned into she. (Don't forget to add the third person "s" !)
PAST TENSE:
Direct Speech: Mary told me, "I am working in a restaurant."
Reported Speech: Mary told me that she was working in a restaurant.
Explanation: Not only the PERSON has changed: I has turned into she, but also the TENSE: Present Progressive (am/is/are working) has turned into Past Progressive (was/were working).