Maybe it’s 20 inches of snow. Maybe it’s an impending hurricane. It could be wildfires, an ice storm that caused a power outage, or flooding. Whatever the specifics, Mother Nature has a whole lot of ways to create havoc and cause businesses to shut down temporarily.
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As an employer, this causes several issues, not the least of which is what to do with employee payroll. How should it be handled on days employees cannot come to work due to a forced closure? The answer to this question is multifaceted.
At the Federal Level: The FLSA and Exempt vs. Nonexempt Employees
Currently, federal law under the Fair Labor Standards Act (FLSA) distinguishes between exempt and nonexempt employees on this matter, creating different standards for different employees.
Exempt Employees
Under the FLSA, exempt employees typically must be salaried as a requirement to qualify for the exemption—and salaried employees cannot have their pay docked for a portion of a workweek in which they completed work. As such, if the workplace is open for any time during the week, salaried employees typically must be paid their full salary for that week, even if they do not do any work at all on the days the facilities are closed. The only exception here is if the facilities remain closed for an entire workweek AND the salaried employees do no work that week. (Bear in mind: Many salaried employees are able to work from smartphones or laptops in other locations, meaning they could work and, thus, need to be paid, even if the office is closed all week.) Docking the pay of exempt employees for a weather-related closure of less than 1 week could jeopardize their exempt status.
Employers do have the option, however, of requiring exempt employees to use their paid time off (PTO) during times they’re unable to come to work, as long as this policy is spelled out in advance. However, if such a policy is enacted and an employee does not have sufficient PTO to cover the absence, the employer still cannot make payroll deductions. Some employers opt to allow advance usage of PTO not yet accrued to cover these situations.
Nonexempt Employees
Nonexempt employees, on the other hand, are not required to be salaried and are often paid by the hour. There’s no federal provision in the FLSA that requires them to be paid for hours they’re not working, even if they were scheduled to be working at that time and could not. However, if they’re able to work from home and do so, they must be paid for the actual hours worked.
Employees Who Opt Not to Come to Work
It’s worth noting that the answers above change only a little when the facility stays open but the employee can’t get to work (the scenario above was solely for when the facility is closed).
For nonexempt employees, nothing changes. Nonexempt employees still have to be paid only for the hours they actually work.
For exempt employees, however, the answer may change. Employers may be able to dock pay for exempt employees in some specific circumstances if the facility is open and the exempt employee does not report to work at all that day AND does not complete any work at home that full day. (Remember that if the employee can and does work from home for a portion of that day—even just to check e-mails or make a business phone call—they are considered to have worked that day, and it won’t be a full-day absence.) In this specific example, it may be permissible for the employer to deduct a full day of pay. This is because the FLSA allows full-day pay deductions when full-day absences are taken for “personal reasons.” This would be considered a personal reason since the employee is not sick and yet is not available for work, even though it’s due to weather. In sum: Deductions may be applied only for full missed days when the facility is open, the exempt employee does no work, and only in cases where both the employee and employer opt not to use PTO instead.
Beyond the FLSA: Local Laws and Employer Policy
Beyond the FLSA, employers also must ensure they’re staying within state and local laws. For example, some states have laws requiring employees to be paid at least an established minimum amount for any day they’ve reported to work (these are often called “report-in pay” laws.) Be sure to check state and local laws before making any policies on this matter.
In order to keep a sense of fairness when it comes to weather-related absences, many employers opt to have a policy that specifically outlines how bad-weather absences will be handled, since the procedure may differ from the standard absence procedure. For example:
• Employers may consider offering some paid personal days off that are specifically allocated to bad-weather days.
• Employers could opt to pay employees when the facilities are closed, even when it’s not legally required.
• Some employers also provide provisions to make up lost hours so that nonexempt employees have an opportunity to keep their income consistent by making up the lost hours later.
None of these policies are legally required, but they would have the benefit of improved employee morale.
How does your organization handle weather-related absences? Does your absence policy in these cases differ at all from other absences?
**This article does not constitute legal advice. Always consult legal counsel with specific questions.**
About Bridget Miller:
Bridget Miller is a business consultant with a specialized MBA in International Economics and Management, which provides a unique perspective on business challenges. She’s been working in the corporate world for over 15 years, with experience across multiple diverse departments including HR, sales, marketing, IT, commercial development, and training.
As a nonprofit 24/7 organization, with a large number of healthcare employees, we cannot afford to paid time Off. Our policy requires exempt staff to make up hours off if they did not work. The exempt staff must show where they worked at least 3 hours to receive 8 hours pay.