Client Advisory: When the Weather Outside is Frightful: To Pay or Not to Pay

January 10, 2013

While many businesses continue to struggle in the aftermath of Superstorm Sandy, the dark days of winter are bearing down. With this is mind, it’s an opportune time to revisit your inclement weather policy to ensure compliance with the Fair Labor Standards Act (“FLSA”) and New York law.

For nonexempt employees, [1] compliance with the FLSA and New York law is straightforward. Employers are not required to pay nonexempt employees for days they do not work, including those days when the office is closed due to inclement weather. However, nonexempt employees who show up for work but are sent home early due to weather, must be paid for any actual time worked and may be entitled to payment just for “showing up.” Specifically, with a few exceptions, New York law requires that employees who by request or permission of their employer report to work on any day shall be paid for at least four hours, or the number of hours in the regularly scheduled shift, whichever is less, at the basic minimum hourly wage. To the extent you are unable to notify a nonexempt employee that the office is closed or that they will not be required to work due to weather, the employer is likely to be deemed to have “requested” the employee’s attendance. For this reason, your inclement weather policy should include various employee notification methods when the office is closed. Consider using voicemail messages, text messages or email to notify employees on bad weather days.

An employer’s obligation to pay exempt employees on bad weather days can be more involved. If an employer closes the office due to inclement weather, exempt employees must receive their full weekly salary even if they do not work due to a shutdown. Remember, employers generally must pay exempt employees their full weekly salary whenever work is performed within the week. If you have a paid time off policy, the employer can require its employees to use accrued time for the absence. However, if the exempt employee does not have any accrued unused paid time off, the employee is entitled to his full guaranteed salary for any absence caused by the employer’s decision to close.

By contrast, if your office is open, but an exempt employee does not report for work due to inclement weather, you can require the employee to use accrued paid time off for the absence. If the exempt employee has no accrued time left, the absence is for “personal reasons” and a full-day deduction is permissible. Remember, partial day deductions are not permitted for exempt employees except when time is used for Family and Medical Leave Act purposes. Thus, if an exempt employee works part of the day, even from home, the employer cannot make any deductions. All inclement weather or emergency closing policies should specifically address the employer’s expectations regarding whether exempt employees will be required to use accrued time for weather-related absences.

Paid absences for weather-related events can be an important investment in employee relations and goodwill, ensuring that employees are safe and at the same time able to maintain their standard of living. Thus, in reviewing inclement weather policies, employers will benefit from not only ensuring compliance with federal and state law, but also considering employee morale when deciding whether to pay employees for weather-related absences.

[1] For purposes of this alert, nonexempt employees are those who are subject to the minimum wage and overtime requirements established by the FLSA and New York law. “Exempt employees” are exempt from overtime rules.

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