Inclement Weather & Compensation

Greetings from the Midwest!

As we write this blog, it’s a winter wonderland outside.

Yep, after being able to wear shorts on Christmas Day, we finally got some snow.

And, of course… the roads were a mess!

Luckily, we have a snow day policy at Integrity HR – printed conveniently in our associate manual (aka employee handbook.) Because of that, the situation was easily handled and productivity didn’t suffer.

No, we’re not bragging.

Our point is… You never know when inclement weather will strike – whether it’s snow, a tornado, earthquake, or something else. It’s important to be prepared and have an inclement weather policy in place.

We’ve written about how to create a snow day policy before (and it’s been a very popular blog ever since!).

What we didn’t touch on is how to handle compensation when your business opens late, closes early, or closes for an entire day due to inclement weather.

So today, we’d like to discuss that with you.

This brings us to an important legal issue – Fair Labor Standards Act (FLSA) guidelines.

Keeping within FLSA guidelines is imperative to creating and using inclement weather policies, because the guidelines dictate how to properly compensate employees during closures.

Compensation for inclement weather closures is different for non-exempt and exempt employees. Here’s how to approach each one:

Non-Exempt:

If your business is closed due to inclement weather, you are not required to pay non-exempt employees, since they are paid by the hour.

That doesn’t mean you can’t, though. Some employers choose to pay non-exempt employees for the day, or part of the day, since it is not the employee’s fault that they can’t work. That’s up to you.

If you elect not to pay non-exempt employees for the day, you can allow those employees to use any accrued paid time off (PTO).

And remember: if your business closes early or opens late due to inclement weather, you must pay non-exempt employees for any time worked.

Exempt:

Things get a little more complicated when dealing with exempt employees. The FLSA has some pretty specific rules for their compensation.

According to the Department of Labor, if an exempt employee performs any work during the workweek, he/she must be paid the full salary amount.

Additionally, employers are not to make deductions from exempt employees’ pay for absences caused by the employer (i.e. when an office decides to close due to inclement weather.)

Here’s what that means:

For early departures or late arrivals due to inclement weather:

If exempt employees work a portion of a business day, they must be paid for the entire day and not be docked any time. Partial day deductions could jeopardize their classification as an exempt status employee – and put you at risk for violating FLSA guidelines.

For business closures:

If your business chooses to close for a day due to inclement weather, exempt employees should still be paid for the full workweek
However, if the office is open, but the employee chooses to stay home for personal reasons, the employee is not entitled to pay. This is pretty straightforward – it’s just like any other day an exempt employee chooses not to come into work.

Of course, in this case, the employee can use accrued PTO, if available, to cover the absence. If the employee has no accrued PTO, you should reduce the employee’s pay in full-day increments (remember what we said about partial day deductions.)

Things to Consider:

• One way to avoid the confusion is to allow employees the option to work from home during inclement weather. This is useful for days your business is open, but safety is an issue (Safety should always be your number one concern!). Read our previous blog for more information about this option.
• Some companies choose to set aside a bank of time to be used for inclement weather closures. If closures occur, the time missed is subtracted incrementally from the employee’s bank. Once it is used up, employees then have the option to use PTO to cover closures. This approach works for both non-exempt and exempt employees.

So there you have it: the basics of compensation & inclement weather closures.

Okay, we’re not finished just yet. Two more things:

First, remember this is simply a guideline, not legal advice. Consulting with your HR professional is the best way to ensure employees are properly paid.

And… just another friendly reminder that when it comes to inclement weather… safety always comes first!

Enjoy the weather – and stay safe out there!