With the smells of turkey, stuffing, and cranberry sauce about to fill kitchens across the country next week, people are getting ready for the holiday season. And as Norman Rockwell has taught us, nothing says the holidays more than a blanket of snow on the ground. But what happens when that blanket of snow prevents employees from reporting to work? Or, even worse, causes an employer to shut down its business for the day? Do you, as an employer, still have to pay your employees? As with most compensation issues, the answer depends on whether the employee is exempt or non-exempt.
If weather conditions cause an employer to shut down operations and close, exempt employees are still entitled to pay for the duration of the closing, assuming the business is closed less than a workweek. The rationale is that the exempt employee is available for work, but it is the employer who has made the work unavailable to the employee.
On the other hand, when an employer closes shop due to inclement weather, non-exempt employees are not entitled to wages during the closing. Of course, the employer has the discretion to allow non-exempt employees to use PTO during the closing.
But what happens when the employer remains open despite inclement weather, and the employee does not report to work? If the employee is classified as non-exempt, the same rules apply – the employee is not entitled to wages during the absence, but the employer has the discretion to allow the non-exempt employee to use PTO for the absence.
As for exempt employees, the answer can be a little more complicated. An exempt employee who stays home even though the employer is open for business is not entitled to pay for that day because the employee chose to remove him or herself from the workplace for personal reasons. If the employer has a PTO policy and the employee has accrued time, the employee can use PTO to cover his or her absence. In the event the employee has no accrued PTO available, the employer can reduce the employee’s pay for the absence—in full-day increments only—without violating the salary-basis test of the FLSA.
However, this assumes that the exempt employee performs no work during the day while away from the office. If the exempt employee performs any work from home (e.g., answering emails, taking calls, working on the computer, etc.), the exempt employee is working and, thus, is entitled to his or her full salary for that day. Now, if the employee only works from home during some of the work day and takes some work time off, the employer may make deductions from the exempt employee’s PTO bank for the time not worked. However, the employee must still be compensated for the entire day of work – even if the employee does not have enough PTO in his or her bank to cover the partial day.
It is imperative to ensure employees are properly compensated during inclement weather – particularly exempt employees so there is no risk of losing the exemption. Of course, it is recommended to engage qualified wage and hour counsel to help you navigate this tricky compensation area.