Punxsutawney Phil, the famous groundhog weather forecaster has predicted that winter will be short and pleasant and springtime is only six weeks away. Hard to believe when much of the nation is blanketed with snow, freezing rain and bitter cold. Whether or not Phil is right and winter is on the way out it might be a good time to review and update your inclement weather pay policy before the next round of bad weather.
Wage Payment Requirements
For non-exempt employees, compliance under federal law is straightforward. Non-exempt employees must only be paid for time actually worked. The FLSA (Fair Labor Standard Act) does not require non-exempt employees to be paid when they do not come to work due to inclement weather. However, some states have “reporting time pay” laws that require non-exempt employees be paid whenever the employee reports to work as required or requested by the employer, even if no work is available. States with “reporting time laws” are California, Connecticut, the District of Columbia, Massachusetts, New Hampshire, New Jersey, New York, Oregon (minors only), and Rhode Island. Employers in these states should consult with their legal counsel to understand the implications of the state laws for their pay policies.
Compliance with the FLSA for exempt employees is more complex. Exempt employees must be paid their full salary for any week in which they perform any work, unless a deduction is specifically permitted under 29 C.F.R. § 541 (b). Section 541.602(b) (1) allows deductions for full-day absences taken for “personal reasons.” So is a snow day a “personal reason” for taking a day off? DOL Opinion Letter FLSA2005-46 confirms that deductions of full day increments may be made from an exempt employee’s salary if the employer is open for business and the employee chooses not to report to work. However no deductions from salary can be made if the employer closes operations. DOL Opinion Letter FLSA2005-41 states that since employers are not required under the FLSA to provide any paid leave to employees, “there is no prohibition on an employer giving vacation time and later requiring that such vacation time be taken on a specific day(s).” Employers who provide paid leave may require employees to take that leave for full or a partial day absence when the offices are closed for inclement weather or “other disasters”.
To sum up the requirements for wage payment and HR best practices due to inclement weather or other disasters:
1. Non-exempt employees do not have be paid when they do not work due to inclement weather or a disaster under the FLSA. Payment may be required by state law and employers in these states should consult with legal counsel to fully understand the implications “reporting time pay” law for their pay policies.
2. If the company is open for business, an employer may make deductions, in full-day increments only, from the salary of exempt employees who do not come to work due to inclement weather or a disaster.
3. If the company closes operations, the employer cannot make deductions from salary, but can require the employee to use accrued paid leave, either in partial-day or full-day increments.
4. Beyond the legal requirements for wage payment employers should consider if providing for some form of compensation during severe weather or other disasters is a key benefit that could assist in attracting and retaining employees.
5. Have a written policy for wage payments that has been reviewed by qualified legal counsel. Provide a copy to each employee and have them acknowledge the policy in writing or by electronic signature.
For more information on compliance with the FSLA and wage payments download KPA’s free webinar “The Essentials of Wage and Hour Law for Dealerships” and “Advanced Wage and How Law for Dealerships” at http://www.kpaonline.com/news-and-events/webinars/recorded-webinars.html