As several states and scores of employers begin the difficult task of rebuilding and/or restoring life and business after Hurricane/Superstorm Sandy’s devastating effects, it seems trivial to ask questions about things like employee classification and FLSA rules. However, correctly handling such issues is key to making sure employers get back up and running as quickly as possible, and can ease employees’ minds as well. After all, if you have to rebuild your home, the last thing you want to worry about is getting your paycheck on time.
To help employers clear the confusion, Laura T. Kerekes, chief knowledge officer at ThinkHR, addresses some post-Sandy questions that may be top of mind for HR/benefits professionals.
1. If the company has no power and sends employees home for the day, how do we pay employees? And does it matter if the employee is exempt or nonexempt?
In general, there are two sets of rules for paying employees depending upon their classification under the Fair Labor Standards Act as it relates to eligibility for overtime. With non-exempt employees, there is no obligation under federal law or state law to pay for time not worked. However, under certain state laws, employers may have an obligation to compensate nonexempt employees under call-in/reporting pay laws, especially if the employees were not advised that they should not report to work and were denied work upon arrival at the workplace.
These pay obligations vary by state. For example, New York employers are required to pay full-time nonexempt employees reporting to work for at least four hours' pay or, if the scheduled shift is shorter than four hours, wages for the number of hours in the shift. In New Jersey, non-exempt employees who report to work must be paid for the hours they work and at least one hour at the applicable wage rate whether or not work is performed.
With respect to salaried exempt employees who must be paid on a "salary basis" under FLSA, employers may not make salary deductions for absences that result from an employer’s partial-week closing of operations, including closings due to weather-related emergencies or disasters. The bottom line is that exempt employees must be paid their full salary if they perform any work in a workweek and only miss work time due to the employer's closure of operations. Closures for a full workweek need not be paid if no work is performed.
2. Are these rules different if a company can tell the employee not to come to work the next day?
For nonexempt employees, if they are told in advance not to come to work and the employees stay home, then the employer is under no obligation to pay them for the time off. The employer and employee can choose to use accrued paid time off to compensate the employee for the missed workdays.
For exempt employees, the “salary basis” rule still applies. In some cases the employee may be working from home during the bad weather days. If the state laws permit employers to do so, employers may deduct the exempt employees accrued paid time off from to resolve the issues related to "salary basis" compliance. Employers should ensure, however, that these employees have not done any work from home during the office closure prior to deducting time from the accrued paid time off bank.
3. If an employee is on FMLA leave, do those "bad weather days" count against that employee's 12-week allotment of time off?
Family and Medical Leave Act regulations are silent about bad weather office closures. However, the regulations do allow for situations when the employer’s business stops operating for a period of time and employees are not expected to come to work — such as when plants closing for a few weeks to retool or a mandatory company-wide summer vacation. In that case, the week the business is closed and no employees are reporting to work would not count against an employee’s FMLA leave entitlement.
If the business is closed for a shorter period of time, the general thinking is that the FMLA regulations relating to holidays would likely apply. Under those rules, if the business is closed for a day or two during a week in which the employee is on FMLA leave, then the entire week would count against an employee’s FMLA leave entitlement.
If, however, the employee is on intermittent FMLA leave, then only the days that the business is closed and the employee is expected to be at work would count against the leave entitlement.
4. How do we handle attendance issues where the office is open but public transportation is not available due to the weather and employees cannot come to work?
If the business remains open but employees cannot get to work because of the weather, employers will need to consider their own attendance policies and practices in determining what flexibility to give employees as it relates to attendance. Employers may encourage employees to car pool or assist them in establishing alternative methods of transportation to get to work.
Under FLSA rules as it relates to pay, however, employers do not need to pay nonexempt employees if they perform no work. For exempt employees, if the business remains open but an employee cannot get to work because of the weather, an employer can deduct an exempt employee's salary for a full day's absence taken for personal reasons without jeopardizing the employee's exempt status. Employers cannot, however, deduct an exempt employee's salary for less than a full-day absence without jeopardizing the employee's exempt status.
5. Does a company have to allow employees to work from home (exempt or nonexempt) if the office is closed due to bad weather?
Employers don’t have to allow employee to work from home, regardless of their FLSA status (exempt or nonexempt). Employers can make those decisions based upon the work that can be done remotely and based on the needs of the business, and should have clearly communicated policies and expectations regarding working from home during office closures.
What other post-Sandy issues pertain to HR/benefits? Share your thoughts in the comments.
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