With severe winter weather pummeling much of the country, employers may be forced to delay opening their doors, close their doors early, or even close for days at a time. This leads to a persistent question—how should employees be paid during a weather closing? Whether an employer has experience with winter weather or whether an employer is dealing with it for perhaps the first time, all employers would be wise to review their inclement-weather pay policies and practices to ensure that they are in compliance with the Fair Labor Standards Act (“FLSA”).
Under the FLSA’s inclement weather rules, different rules apply to “exempt” employees versus “nonexempt” employees. With respect to exempt employees—often colloquially known as “salaried” employees—these employees must be paid their full weekly salary for any workweek in which they stand ready, willing, and able to work and in which they actually perform any work. See 29 C.F.R. § 541.602(a). Thus, exempt employees’ pay may not be docked when the office is closed due to inclement weather for less than a workweek. Correspondingly, exempt employees’ pay may not be docked for late arrivals or early departures caused by inclement weather.
However, if the office is closed for an entire workweek and the exempt employee does no work during that week, then the employee need not be paid for that week. Remember, however, that the rule focuses on whether work is done during the week, not just on whether the office is closed—so even if the office’s building is closed for a week, if the employee is permitted to and does work from home during that week, the employee must be paid their full weekly salary.
On the other hand, if the office is not officially closed for business, but an exempt employee nonetheless decides not to work due to the weather, the employer may deduct the employee’s pay for full-day absences. FLSA regulations permit employers to deduct exempt employees’ pay when “an exempt employee is absent from work for one or more full days for personal reasons, other than sickness or disability.” See 29 C.F.R. § 541.602(b)(1). In turn, the Department of Labor (“DOL”) views absences for inclement weather when the office is open for business as being for “personal reasons.” See DOL Opinion Letter FLSA2005-46. Keep in mind, however, that deductions may be made only for full-day absences—deductions for partial-day absences are not permitted. Also keep in mind that an exempt employee’s pay may not be docked if that employee is permitted to and does work from home on such a day, even if for only part of the day.
Conversely, the rules for nonexempt employees—often colloquially known as “hourly” employees—are more straightforward: Under the FLSA, nonexempt employees must be paid only for the hours they work, no more and no less. However, employers should check their state laws; several states have “call-in” or “report-in” laws, which require employers to compensate nonexempt employees if they show up to work but are sent home early. Additionally, employers should remember that employees generally cannot “volunteer” their services to their for-profit private-sector employers; therefore, if nonexempt employees help clean up after a storm, their time spent snow-shoveling should be paid.
Can taking Paid Time Off be required?
In considering all of the above, employers should evaluate how their paid time off ("PTO") policies will interact with inclement weather closings. Because the FLSA does not require employers to provide vacation time, the choice of whether to deduct PTO time for days/hours missed due to inclement weather is up to the employer. See DOL Opinion Letter FLSA2005-41. For example, in a situation where the office is closed for less than a workweek, even though an employer must pay exempt employees their full weekly salaries (as explained above), it is up to the employer whether to require that the days/hours that the exempt employees were not able to work be deducted from their PTO banks. But, it should be noted that employees with zero PTO time or employees who have been approved to take their remaining PTO time at a later date still must receive their full weekly salary. See id. Employers might handle such a situation by permitting these employees to incur a negative PTO balance.
Furthermore, the above rules represent the minimum required by the FLSA—employers are always permitted to be generous and to go above the minimum standards required by law. Thus, employers might consider providing a fixed number of paid inclement weather days or permitting nonexempt employees to take PTO time in lieu of going unpaid. In any event, an employer’s policy regarding how PTO and/or paid inclement weather days are to be applied in the case of bad weather should be put in writing and consistently applied. In some cases, it is not just about following the requirements of the FLSA, but also managing employee expectations and morale.