With April unofficially “national tornado and storm month,” this is a good time to think about having a policy for handling externally caused shutdowns. Here are things to think about.
If a company opens an hour late because of a storm, should an employer pay employees who show up earlier because they didn’t hear the announcement?
What time does the workday end when employees are given the option to go home because an incident such as a gas leak forces evacuation of the building? What if the employer sends them home subject to recall when the facility is safe again?
When an emergency strikes, you may want to pay stay-at-homes, but do you have to?
Compensating employees around facility closings can get tricky. Here are some tips from the compensation manager’s best friend for decades, BLR’s Employee Compensation in [Your State].To some degree, questions of payment in a closedown are governed by the Fair Labor Standards Act (FLSA). Many states have statutes covering this issue as well.
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Those requirements should be incorporated into a more comprehensive policy covering the closing of your facilities, including (1) what circumstances will lead to a closing, (2) who makes the decision, (3) how the decision is communicated, and (4) what to do about employee compensation.
Make sure that all employees are notified of the policy, and you won’t have any surprises when you do have to close down.
Compensation
As with most compensation questions, the first issue is whether employees are exempt or nonexempt:
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Exempt Employees
Exempt employees are generally paid their normal amount if the workday is shortened.
In the next issue of the Advisor, we’ll look at how to handle hassles related to emergency pay, and we’ll look at the resource this advice came from.
This article is incomplete–it should also mention that an exempt employee is to be paid (up to seven days in some cases) for their time even if they don’t work due to extenuating business circumstances, but were willing and able (such as in the case of bad weather causing a plant closing). If they want to work but you close, they still get paid. (At least that’s the case here in Florida).
M. Kay Wilson, PHR
Wildwood, FL