Is there an obligation to pay employees in the case of inclemeny weather?
Inclement weather, such as heavy snow or other types of disasters, often causes substantial business interruption and loss of productivity, as employees may arrive late to work, if at all, transportation can be difficult, if not impossible, and businesses may shut down for days on end. While loss of productivity is one thing, getting hit with a claim under the Fair Labor Standards Act (FLSA) can wreak even more havoc on an employer than the storm itself.
With the blizzard of 2003 and more recently, two major snow storms (and a lot more snow) in 2006, a question I am often asked by employers is: Do I have to pay my employees for a “snow day?” The U.S Department of Labor issued two opinion letters in 2005 on the proper payment of or deduction from wages under the FLSA when inclement weather occurs. See Opinion Letter FLSA2005-41, Oct. 24, 2005; see also Opinion Letter FLSA2005-46, Oct. 28, 2005.
The question of exempt “salaried" employees
Section 13(a)(1) of the FLSA provides a complete minimum wage and overtime pay exemption for any employee employed in a bona fide executive, administrative, or professional capacity who is paid on a salary basis and is compensated at a rate of not less than $455 per week. The Code of Federal Regulations requires that an exempt employee receive the full salary for any week in which the employee performs any work without regard to the number of days of hours worked. But, where there is an entire workweek in which no work was performed, exempt employees need not be paid for such workweek.
What do you do when the office is closed?
If an office closure is employer-sanctioned, e.g., the employer decides to close the office due to a weather-related emergency or other disaster, the employer must pay all exempt “salaried” employees their full salary and may not deduct any pay from exempt employees because if employees are “ready, willing and able to work, deductions may not be made for when work is not available.” See 29 C.F.R. 541.602(a). An employer may ask its exempt “salaried” employees to use personal, sick, or vacation time for the missed days, but in no event should this time be treated as unpaid, even if the employee has no accrued leave time.
The only exception which allows an employer to treat an office closure as unpaid time for exempt employees is if the office is closed for an entire workweek. In this case, the employer may deduct the entire workweek from the employee’s salary.
What happens when the office is open?
Conversely, if there is inclement weather causing transportation difficulty, but the office remains open, deductions may be made to an exempt employee’s salary for each full-day absence. For example, if an employee is unable to make it into work for two days because of getting stuck in the snow or fear of driving in icy conditions, yet the office is open, it is proper for an employer to deduct two full-day absences from the employee’s salary.
However, always be mindful of this “full day” rule. If an exempt employee is absent from work for one-and-one-half days due to inclement weather, the employer may only deduct one full day from the salary.
Should you pay non-exempt “hourly” employees?
Employers need not pay non-exempt “hourly” employees for time not worked. It is up to the employer to decide how to handle non-exempt “hourly” employees during snow days.
- The employer may consider the “snow days” simply leave without pay;
- The employer may ask hourly employees to use some of their paid time off benefits if they wish to be compensated for the “snow days;” or
- The employer may be generous and compensate all non-exempt “hourly” employees for the “snow days.”
Be prepared with an inclement weather policy
Employees are generally uncertain whether they will be paid due to an office closure. Employers normally are busy trying to boost productivity and determine how to calculate the next payroll after weather-related office closures and employee absences. To alleviate some of the stress and questions surrounding office closures in these days of extreme weather systems, it is advisable to have an inclement weather policy in place that complies with the FLSA, is clearly communicated to your employees, and is maintained in your employee handbook.
If you would like assistance in drafting/revising an inclement weather policy for your employee handbook or have any other questions about dealing with inclement weather, please contact email@example.com.