Published in the NH Business Review (1/20/2017)
The winter season presents employers with many weather-related issues, ranging from obligations to keep outdoor areas safe to deciding whether to close the business for all or part of the day. Closing the business due to inclement weather raises pay issues – what pay are employees entitled to when the business closes?
The federal Fair Labor Standard Act (FLSA) does not permit employers to make deductions from exempt employees’ pay for partial-day, or even whole-day closures. When an employer closes the business, the employer has made work unavailable to the exempt employee, so the exempt employee must be paid his/her full salary for the week even though he/she may not have worked the full workweek. The only exception is when the employer’s business is closed for an entire week, and exempt employees do not perform any work at all during the closure. However, it is unlikely that an exempt employee would not be working via smart phone or remote access, in which case he/she would have to be paid his/her full salary.
If the business is open, but the exempt employee could not make it in because of the weather, then the FLSA has an exception that the exempt employee does not have to be paid if he/she has been absent a full day and did not perform work at home. If the employee works part of the day from home, the employer can require that the employee use accrued paid time off. However, employers should be mindful that taking a hard stance on this issue could create a morale issue where exempt employees typically work more than 40 hours in a workweek due to the nature of their positions. Generally speaking, employers will be required to pay exempt employees as usual during a weather-related closure.
During a weather-related closure, nonexempt employees are not entitled to pay. The FLSA only requires that these employees be paid for hours actually worked. If the office closes early due to bad weather, the non-exempt employee must be paid for the actual hours that he/she worked up to the time of the closure.
However, if the non-exempt employee works from home, the employee must be paid for those hours worked. Employers can allow nonexempt employees to use accrued paid time off to cover the time away from work due to the closure. If nonexempt employees are allowed to use accrued paid time off, that time is not working time and therefore not counted toward hours worked for overtime calculations.
New Hampshire law requires that nonexempt employees who are paid on a salary basis must receive a full salary for any pay period in which the employee performs any work without regard to the number of days or hours worked.
To avoid any confusion about how weather-related closures will be handled, businesses should have a written inclement weather policy in their employee handbooks.
The policy should be clear that employee safety is the business’ main concern and that employees must make their own determination as to whether it is safe to report to work when the office has not been closed. The policy should also be clear as to the employees’ responsibility to give notice if they cannot make it to work due to bad weather and whether the employees will be given the opportunity to make up missed time.
Employers should be mindful of state law regarding “report-in” pay that applies when an employer decides to close its business due to inclement weather. New Hampshire’s “report-in” law, requires that employees who report to work at the employer’s request be paid no less than two-hours pay at the employees’ regular rate of pay. However, if the employer made a good-faith effort to notify the employees not to report to work, then the employer is not obligated to pay the two hours “report-in” pay.
Employers should be careful to have policies and procedures that explain how and when employees will be notified if the office is closed due to inclement weather which will also assist the employer is showing its good faith effort to notify employees in advance.
Beth Deragon, an attorney in the Employment Law Practice and Litigation Group at the law firm of McLane Middleton, can be reached at 603-628-1490 beth.deragon@mclane.com.