With winter weather arriving, many employers will soon face questions about whether certain employees are entitled to be paid when the office closes for the day or the employee can’t make it to work.
The answer is tricky when it comes to employees who are “exempt” from the normal minimum wage and overtime requirements of the Fair Labor Standards Act. “Exempt employees” are generally salaried employees who work in a bona fide executive, administrative, or professional capacity.
According to 29 C.F.R. § 541.602, whether the company can deduct money from an employee’s salary depends on whether the company is closed for the day, the employee decided he or she could not make it to work, and whether the employee misses a full day or something less than that.
The general rule is that employers can deduct from an exempt employee’s pay when the employee is absent from work for one or more full days for personal reasons other than sickness or accident. But if an employee is “ready, willing, and able to work,” the employer cannot make deductions when work is not available.
In the context of inclement weather, that means that if the office closes and the employee would have been “ready, willing, and able to work,” the business cannot deduct from the exempt employee’s salary. However, if the business is open but the employee cannot get there, the employer can deduct from the salary because the employee is missing work for a “personal reason” other than sickness or accident.
If, however, the employee misses less than a full day, the company cannot deduct from the employee’s salary.
Many employers wonder whether they can require an employee to use PTO or vacation time when the office has to close or the employee cannot make it to work.
The FLSA does not require employers to provide vacation time or PTO to employees. Notably, this means that there is no prohibition on an employer giving an employee vacation time and later requiring that such vacation time be taken on a specific day. See DOL Opinion Letter (Oct. 24, 2005).
Therefore, as long as an employer does not reduce the employee’s guaranteed salary, the employer can reduce the accrued leave someone has acquired. This is true even if the employee will be left with a negative PTO/vacation time balance. This is also true even if the company makes the decision to close the office for the day, or the employee is absent from work for less than a full day.
Takeaway: Employers need to make sure to follow the FLSA’s rules for paying exempt employees on snow days. For more information about the FLSA’s requirements for weather-related closures, click here.