The 2017 hurricane season has certainly packed a punch on the entire Southeastern part of the United States. During weather emergencies like Hurricane Harvey and Hurricane Irma, the focus is always on making sure all the necessary preparations are made to keep people and property safe from the storms. However, once the weather emergency is over it is time to get back to business. And, for HR professionals, it is important to make sure that payroll is handled properly for employees who were unable to report for work if there was a business closure.
Here are some important tips on how to make sure you pay your employees properly:
Exempt employees: You must make sure the Exempt receives his/her guaranteed salary for the entire work week. This means that the Exempt employee who is at home, on the day(s) the office/facilities are closed, must be paid their regular pay OR you may require him/her to use a VAC/PTO day(s). Although this is permissible by the Department of Labor (inserting VAC/PTO for business closure day(s) I would not recommend that you require your Exempt employees to use VAC/PTO.
The reason why I say this is that salaried Exempt employees are your more professional employees who probably handled extra duties to prepare for the weather event. And, there will be much work/cleanup to be done, and extra work hours put in, upon return to work. Additionally, the salaried Exempts may also do a bit of emailing/phoning/working while home and the office/facilities are closed. Requiring Exempts to use their VAC/PTO during a situation like this is likely to create more of an employee relations’ issue (unfair…). To me, the cost is minimal to do so, and I recommend you pay them.
Also, bear in mind the FLSA rules were written long ago and do not really “fit” the current environment with mobile phones and ability to work remotely. So, I recommend to clients to pay Exempts during these situations their normal salaries and not require them to use their VAC/PTO time.
Regarding hourly, Non-Exempt employees they do not have any guarantee of hours, unless specific in a collective bargaining agreement (union contract). If you choose to pay Non-Exempts for time during a weather emergency, just be certain that you are consistent, as variations in paying some employees and not others could lead to claims of discrimination based on protected characteristic. As an example, if you paid your field employees who are all male “Weather closing pay” of two days, but you didn’t pay your administrative/office staff who are all female, this would be legally problematic, but also cause a serious employee relations’ issue.
Here at RPC, we wish everyone affected by Hurricane Harvey and Hurricane Irma a very speed recovery.
P.S. Below are the official rules regarding the Fair Labor Standards Act and paying Exempt and Non-Exempt employees.
Fair Labor Standards Act (FLSA)
Non-exempt employees. The FLSA requires employers to pay non-exempt employees only for hours that the employees have actually worked. Therefore, an employer is not required to pay non-exempt employees if the employer is unable to provide work to those employees due to a natural disaster. An exception to this general rule exists where there are employees who receive fixed salaries for fluctuating workweeks. These are non-exempt employees who have agreed to work an unspecified number of hours for a specified salary. An employer must pay these employees their full weekly salary for any week in which any work was performed.
Exempt employees. For exempt employees, an employer will be required to pay the employee’s full salary if the worksite is closed or unable to reopen due to inclement weather or other disasters for less than a full workweek. However, an employer may require exempt employees to use allowed leave for this time.
Exempt employee chooses to stay home because of weather. The Department of Labor (DOL) considers an absence caused by transportation difficulties experienced during weather emergencies, if the employer is open for business, as an absence for personal reasons. Under this circumstance, an employer may place an exempt employee on leave without pay (or require the employee to use accrued vacation time) for the full day that he or she fails to report to work. If an employee is absent for one or more full days for personal reasons, the employee’s salaried status will not be affected if deductions are made from a salary for such absences. However, a deduction from salary for less than a full-day’s absence is not permitted, although the employer may make a partial day time deduction from the employee’s leave bank (if there is insufficient time in the leave bank, no deduction from salary can be made). Caution is recommended, however, in docking salaried employees’ pay. Moreover, many employers instead require employees to “make up” lost time after they return to work, which is permissible for exempt employees. This practice is not allowed for non-exempt employees, who must be paid overtime for all hours worked over 40 in a work week.