Understanding Employee Pay During and After a Hurricane
For many employers, Hurricane Ian brought questions related to employee pay. One of the most frequently asked questions was, “Should I pay exempt employees who miss work due to bad weather conditions?” An exempt employee is someone who is not entitled to overtime pay for more than 40 hours worked in any workweek. When it comes to deductions from exempt employees’ salaries, it is easy to get into trouble. The general rule is that exempt employees are entitled to receive their entire salaries for any workweek in which they perform work. This means that if the work site closes for a partial week due to bad weather conditions (such as a hurricane) and the exempt employees have worked during that workweek, those employees are entitled to their full salaries. However, if the employer has a leave benefit, such as PTO, and the employees have any leave remaining, the employer can require its employees to use paid time off for any time the employees are away from work. If employees do not have any remaining leave benefits, they must be paid.
If the work site remains open during inclement weather and any employees are absent (even if due to transportation issues), those employees can be required to use paid time off. If the employees do not have any paid time off remaining, employers may deduct a full day’s absence from those employees’ salaries. For a more detailed explanation, please visit www.dol.gov.
Other payroll issues that arise during and after a storm generally relate to what constitutes compensable time for non-exempt employees. The Fair Labor Standards Act (FLSA) only requires that non-exempt employees be paid for the hours they actually work. However, those non-exempt employees on fixed salaries for fluctuating workweek(s) must be paid their full weekly salaries for any week during which they worked. Further, those businesses, such as hospitals and nursing homes, that remain open during a storm and require employees to remain on-site during the storm may have to pay those employees who are required to be on-site during a storm for all the time they are at their employers’ place of business, as they may be considered to be “on call.” Different rates for on-call time can be implemented—provided the rates are communicated in advance of the emergency.
The 2022 hurricane season has already shown that storms can disrupt all aspects of life. For this reason, employers should have hurricane preparedness plans. A well-done hurricane preparedness plan will address a host of issues, including but not limited to: preparing facilities for severe weather, ensuring the business is properly insured, determining whether a business will stay open, and if the business stays open, how it will be staffed.