To Pay or Not to Pay – Winter Weather Brings Employer Headaches
Winter arrived with a boom this weekend in the Mid-Atlantic region of the country. Storm closings might bring joy to children, but to business owners bad weather means bad – or no – business. In addition to lost revenue, many business owners struggle with wage and hour questions wondering whether to pay employees for time missed due to inclement weather. So what do you need to know?
When You Close, Wage Payment Depends on Employee Classification
For salaried exempt employees, if the business closed for only a few days, federal wage and hour law requires that you pay salaried exempt employees. With that said, you may be able to require an exempt employee to use paid-time off (PTO) depending on your business’s PTO policy.
For nonexempt employees, who are paid on an hourly basis for work performed, there is generally no obligation to pay nonexempt employees for missed work. That said there is nothing wrong with paying a nonexempt employee for time off due to a weather-related closing.
On a practical level, you should also ask whether it’s worth deducting pay, or whether, in the interest of employee relations, it might be better to offer full pay if the business can manage it. Either way, it’s probably best to make your company policies clear in the beginning. This may be something you should consider addressing in your employee handbook.
Some states have laws addressing early closings and late openings. For example, New York requires that an employer pay an employee for at least four hours, or the number of hours in the regularly scheduled shift, whichever is less. New Jersey requires an employer to pay for at least one hour.
When You Remain Open, But Employees Cannot Make it to Work
If the business is open, and an employee cannot make it to work due to inclement weather, the employer generally has the option to decide whether to pay the employee for that day or not.
Regardless of how you handle absences and late arrivals, establish a weather emergency policy and remind employees before an anticipated adverse weather event of the policy. For instance, many employers require that employees notify managers if the employee cannot make it in or will be late. Likewise, it’s a good idea to remind employees that if the business is open and the employee can’t make it to work, the employee will need to take paid time off (i.e., a vacation day or sick day) or take unpaid leave, if that’s your business’s practice.
What if the Employee Teleworks from Home?
If the employee is working, then there is no basis for docking his or her pay. This is true for both exempt and nonexempt employees. Make sure you track time actually worked by nonexempt employees.
Where Can I go for More Information?
For more on the federal wage and hour law, check out NFIB’s Guide to Wage and Hour Laws. Business owners with questions can also call the NFIB Small Business Legal Center at 800-NFIB-NOW.