With the recent winter storms that swept the nation, many employers were forced to close their operations for one day, if not a few days depending on their region of the country. Some employers do a good job of communicating office closures to their personnel while others…not so much. One fundamental fact is that several employers are faced with determining compensation for employees for the days missed due to inclement weather. Employers should always first turn to applicable federal and state laws, as well as their company policies, to guide them. Within the scope of this article, it is not possible to explore every state law or every employer’s policy should they even have one. Therefore, keep the following tips in mind when you are deciding – to pay or not to pay:
1. Decide if the company is (was) officially open or closed for business.
2. If officially open, that means employees are expected to be at work for their regularly scheduled time. If an employee does not come to work, that employee should use available vacation or sick time, providing the company has such policies; otherwise the time will be unpaid.
a. Exempt employees (those not eligible for overtime compensation) should be deducted in full-day increments. If they work any part of the day, however, they must be paid for the full day. Otherwise, you will be in jeopardy of losing the exempt status for that employee.
b. Non-exempt employees should be deducted for the amount of time actually missed from their regularly scheduled workshift. If they work any part of the day, they should be compensated for only those hours actually worked.
3. If officially closed, that means most employees are not expected to arrive at work. I say “most” because some employees go to work anyway, especially if they live close by, have a key to the building and there are no other restrictions placed upon them from working – usually these will be key employees or exempt employees and it also depends on the industry, type of work, security measures, etc. If work is performed by an employee, the above rules apply.
4. Where officially closed, and no work is performed, a company may advise employees they will have to use available vacation or sick leave if available. Where no benefit is available, employers may not deduct the pay of exempt employees but may deduct the pay of non-exempt employees for the actual time missed.
5. That said, here are best practices for when the office is officially closed and no work is performed by either exempt or non-exempt employees:
a. Exempt employees should be paid for the full day.
b. Non-exempt employees should be paid for the actual shift hours they missed due to the company officially closing its doors.
You may wonder why not make them use available vacation and sick leave; after all no production occurred while the office was closed yet we have this payroll expense and nothing to offset it. That is a fair question when considered at face value. However, consider also the employee did not request this time off; consider the inclement weather was not within anyone’s control; consider the office being officially closed was a decision made by the employer for safety concerns and to make an employee use available vacation and sick leave on top of that seems like a form of punishment; consider the morale of your workforce and the workplace standards your company strives to uphold and the extent to which you rely on your employees to do their part in this effort. The benefits of paying your employees far outweigh not paying them when considering these factors.
It is safe to say an employee who believes a company, no matter its size, takes their welfare into consideration is an employee who, more times than not, can be retained.
Latest posts by Laura Moxley (see all)
- Oklahoma HR State Council Receives Distinguished Award - May 7, 2012
- April 25 Proclaimed Oklahoma HR Appreciation Day by Governor - April 25, 2012
- Calculating Worker’s Compensation and Total Cost of Risk - October 14, 2011