Exempt Employees Salary Reduction Regulations

One of the hottest HR topics right now is reductions for employees. Many employers are faced with a choice of laying off employees, or using other tactics to reduce payroll.

 

When employers reduce exempt employees’ salaries, they must take certain precautions to avoid breaking the law.

 

One option to reduce payroll is to reduce hours for employees. By having every hourly work 36 hours per week rather than 40 hours per week, an employer can reduce his or her payroll expenses by 10%. (In many cases, however, the cost of benefits remains constant.)

 

However, that solution won’t work for salaried exempt employees. Under the federal Fair Labor Standards Act, or , employers must pay an exempt employee his or her full weekly wage, regardless of how many or how few hours the employee works per week. If the exempt employee works 60 hours per week, he or she is not entitled to overtime. However, if the exempt employee works 20 or 30 hours per week, he or she must still be paid the full weekly salary.

 

This raises a question for employers. Is there any legal way to reduce an exempt employee’s salary?  The answer is “yes.” Under certain circumstances, an exempt employee’s salary can be reduced, according to the U.S. Department of Labor.

 

In order for the exempt employee’s salary reduction to be defensible, it should be:

 

  • Permanent
  • Applied to an entire group or class of employees
  • Not directly tied to a reduction in hours 

If an employer temporarily reduces an exempt employee’s salary when business is slow, this can change the exempt status of everyone in that job. For this reason, the employer should always present the salary reduction to employees as permanent. There should be no promise or suggestion that the salary reduction is only temporary. The salary reduction needs to remain in effect for a minimum of 3 months.

 

Applying the salary reduction to only one or a few exempt employees can also change their exempt status. Ideally, the company would reduce salaries for exempt employees by the same percentage, across the board. If that is not possible, everyone with the same job should have a similar salary reduction.

 

Reducing hours for exempt employees when salary is reduced is a grey area. The safest course of action is for the employer not to reduce the number of hours when salary is reduced.  In some cases, the courts have ruled that when both salaries and hours are reduced, it changes the employees’ exempt status. In the worst possible scenario, employers have been required to pay the workers overtime for the past 3 years.

 

However, according to the SHRM, or Society for Human Resource Management, in some cases the courts have found that when a reduction in salary and hours for an entire class of exempt employees is part of a change in business tactics, the employees retain their exempt status.  

 

Some states including have different exempt employee laws.

 

 

292 thoughts on “Exempt Employees Salary Reduction Regulations

  1. Hi Kathy! Happy 2011 to you, too! This question is not silly — we get many queries from employees and workers on this topic. There’s even an OSHA worker safety regulation about it. As an employer, you do have to provide access to water in the workplace throughout the day, but tap water is fine.

    Under OSHA CFR 1941.141 requires an employer to provide “potable” water in the workplace. That simply means water that is safe to drink, like tap water. While many people enjoy bottled water, it is not necessary. As long as your employees have access to tap water in the break room, that fulfils the requirement. The purpose of this worker safety regulation is to prevent employees from becoming seriously dehydrated, so the employees do need to have access to the tap water all day, or at various times during the day, not just during meal breaks.

    If there was no tap water available, as on a construction site, then you would have to make arrangements to provide drinking water. However, there is no requirement that it be bottled water or spring water. HTH, and thanks for reading the blogs!~ Amelia

  2. 1) I was told my position was being eliminated, they demoted me and I took a salary cut. This was about a year ago. I was the only person in my company that this happen to, other people with my title in different offices across the country stayed with the same title. A month ago they posted the position that I had, that I was told was eliminated on the company web site. I asked what was happening, this position was eliminated. I was told “that in a branch like ours, this position is required”. I also asked why I cannot go back to this position. I was told that I would have to apply though my company’s web site. I applied, was interviewed and the position was given to a person outside of the company. Is this possible?

    2) I also have reservations that my manager is racist. When he first was transferred to my office, a few days later he asked, why am I being paid the salary that I am being paid. I responded to him that that was the amount I was offered to leave my last job and move from across the country to work at this company. And that I have been receiving raises based on my performance and also yearly company bonuses. He slowly but surely laid off people of my same race due to lack of work or job performance. He was unable to do this with me. When my son started to have teenage problems, I had to take a few days off due to this. He sat me down and asked me about this and what was my plan, he needed me at work and wanted to make sure that I had this under control. I told him that it was going to be under control, my son after Christmas break was going to attend a military school. A few days later is when I was told my position was eliminated.

    3) When I took the demotion and salary cut also came a new job which required me to get a security badge for one of our clients. At first I was unable to due to an arrest in my younger days. It was no problem all I had to do was show that I was never convicted and that the case was dismissed. As soon as I alerted him of this, at the end of the day I had a warning letter stating if I was unable to get this badge, I would be terminated due to the need for me to have this badge to perform my primary duties. I was able to get the information I needed and I was able to get this badge. When I informed him of this, and that I would be able to access the site, when do I start in this new position? I was told that the position I needed a badge for is going to stay with the person who has it and no change would be made. I was given a different area of responsibilities part of those was still doing the same job I was doing before but in my designated area and the other personnel (with my new demoted title) absorbed the other areas of my responsibities.

    4) I truly believe that he does not want me in my previous position due to the amount of salary that my company would have to pay me, and he will not let that happen.

    5) There are other things he states which lead me to believe he is a racist, I will not go in to detail this is long enough.
    What do you suggest I do or what can I do? If anything?

  3. Hi Joe! We agree that your high salary was a problem for this supervisor, but the way he is handling it is legal. Your post contains a lot of issues so we have numbered them for discussion.

    1) This is completely legal and appropriate. The employer eliminated the position. Then the employer’s business needs changed, and they decided they needed to hire someone for the position, a year later. They did so. They did the right thing by letting you interview for the position. They were under no obligation to hire you. If they did hire you for your old job, they would be under no obligation to reinstate you to your former salary.

    2) We agree that this is the crux of the problem — the supervisor thought that you were being paid too much for the job, compared to other people within the company. They could have simply reduced your salary. Instead they tried other tactics, like eliminating the position and eventually hiring someone new, probably at a lower salary. There is nothing inappropriate about this.

    In most states, you are entitled to take unpaid time off work when a son or daughter under 18 has a serious health condition, but not when they have school or social problems. Three days off is a lot, for an unexcused absence. The supervisor had a right to question this. You probably overshared when you told him that your son would be sent to military school (rather than simply that the problem was solved.) If your boss felt you were being overpaid, it was probably not very diplomatic to let him know you can afford military school for your son.

    3) The employer can require that you get a security badge with the client as a condition of employment. We see nothing inappropriate in the way this was handled. The supervisor did the right thing in informing you that if you could not get a security badge, that would be a problem. It is not clear why he then changed your duties, but the company has the right to do so.

    Arrests cannot be considered in hiring, promotion or pay in most cases. If the employer decided not to restore you to your former position based partly on this new knowledge of your arrest record, that would be unlawful.

    4) We agree that the supervisor thought you were overpaid and took steps to correct that situation. You are mistaken about one thing. If the company had hired you for the newly recreated position, they would have been under no obligation to restore you to your previous salary. If you made $100,000 before, they could decide that the position now pays $50,000 and pay you that amount. In fact, this might have been one factor in thier decision. They might have felt that you would be less than thrilled to be offered the new salary. This supervisor also may have thought all along that you were not the right person for that job, for factors that have nothing to do with race.

    One unintended result of the Ledbetter Fair Pay Act passed in 2009 is that it is more difficult to pay one employee a higher salary than people of a different race or sex in similar jobs, without facing charges of illegal discrimination in pay. So your former high salary could be an unacceptable liability for the company, now.

    It is also possible that the changes you are blaming on the supervisor are actually company policy. He may have been told that part of his job in this position was eliminating performance problems that had been allowed to fester, and dealing with the fact that you were being overpaid.

    One thing that is clear from your remarks is that you never really developed an alliance with this new supervisor. You are not on his team, so to speak. It is fairly common in the business world for employees to resent or reject a new supervisor. However, the bottom line is that he makes the employment decisions. If you cannot develop a strong working relationship with him, your days in this job are probably numbered.

    5) It is actually legal to be a racist. (In some ways, your boss is a product of his upbringing and cannot help what he is. However, he can help how he acts.) What is illegal under Title VII of the Civil Rights Act is making employment decisions based on race, color, sex, religion, national ancestry, etc. It is also illegal to offer different pay or working conditions based on race, sex, age, disability, etc. Nothing you have told us so far indicates that this supervisor is committing illegal discrimination. You say he addressed performance problems and terminated people of one race. If people of other races had similar performance problems that were not addressed, this may be illegal discrimination. However, if he addressed all the performance problems, then this is not racism.

    Comments at work can be illegal discrimination. In one recent case we reported, a female supervisor repeatedly said, “one black paramedic is one too many.” That is illegal discrimination in the workplace.

    You can certainly make a tactful request for feedback on why you were not chosen for your former position, and this might provide valuable insight into the situation. For example, there may be performance problems or expectations that you were not aware of. If the company has an HR department, it might be better to approach them about this matter, rather than your immediate supervisor. If you believe that race was a factor in that decision, or that there is illegal discrimination based on race at your workplace, you can file a complaint with the EEOC at http://www.eeoc.gov. It is illegal for an employer to retaliate against an employee who files a complaint in good faith. However, nothing you have told us so far is evidence of illegal discrimination.

    Some states have different family leave and discrimination laws that might offer you more protection. Since you don’t mention which state you are in, we only addressed federal issues.

    This is a complex situation, so feel free to post additional information, particularly on the topic of discrimination or any other questions you might have. HTH and thanks for reading the blogs!~ Amelia

  4. Hello again and thank you for taking the time to respond. I understand what you are saying, they can do that.

    1) One of the things I did not state was that when he first arrived, he promoted a person to the title that I had before. They are both Caucasian and I am Hispanic. We use lack of work in the company to get rid of people for anything. He is the type of boss that if you do not do it his way it’s the highway and he will make it happen, if you try to question him and or ask him, he will reduce the work load and lay you off for lack of work. I have seen him do it way too many times.

    2) I am the only Hispanic male in my department in this position.

    3) Well I do believe he does things that are not warranted. The thing with me is what he says. The last thing he said was that he arrived at home one night to find his grandson watching Dora the Explorer, and now he is learning this Spanish SH$T, that really bothered me at another time he were outside of the office and some people were across the way playing music very loud from their car, “what kind of ………he did not know what to say since I was there ……………. Miguel music is that?” by the way my name is not Miguel but he used my name. He was mad and disgusted that he had to hear this type of music.

    4) The other guys he let go of he would also ask them to do things for him, like go buy him lunch, buy him cigarettes and items like that.

    5) I am presently very upset and I have talked to a lawyer about this and he said I may have a legitimate suit.

    6) The thing it is that I personally like this company, it is just this boss that I have. Why sue this company for the actions of this manager? He does like Hispanic woman, he is always making comments on them and at this time all the support admin staff is all Hispanic woman.

    7) This is the first time in my life that I am bringing up an issue like this due to race, never has this happening to me or have I ever experienced anything like this since I have started working at the age of 16, I am 38 now. I am not trying to make something out of nothing.

    8. It really bothers me and I feel like I have been cheated out of something. I have to trade in my car to a less expensive one, I have been using my savings to make ends meet and pretty soon I will most likely once my saving runs out it will be difficult to pay my mortgage. I will stop here. I do thank you for your time and I appreciate your response to this.

  5. Hi joe! You are very welcome! We are always here to help. Again, we have numbered your comments for easy reply. Based on this information, there may be illegal discrimination here.

    1) It is legal for a supervisor to promote an employee. If you were demoted and the other employee was promoted due to race, that would be illegal discrimination. However, the company can probably make a case that there were other reasons for the changes in staffing. It is cowardly for the company to use lack of work as an excuse to fire people, or demote them, but it is not illegal. In most cases, the employer could have simply said, “You are making too much money, we’re going to demote you.”

    2) If you live in a state where 50% of the population is Hispanic, and there are 100 people in your position, it is probably illegal discrimination in hiring to have only one Hispanic employee. But if there are only a few people who hold the same job as you, this is not necessarily discrimination. Even if it is, it is discrimination against the Latino applicants who are not hired, not against you.

    3) These negative comments about people of Hispanic heritage and about the Spanish language are unacceptable even if they are made away from work. Negative comments of this kind can create a hostile work environment. That is a very specific type of discrimination where members of a protected group are targeted and made to feel unwelcome in the workplace. In this case, negative remarks about Hispanic people do that.

    4) If he created different working conditions for Hispanic employees by expecting them to do personal errands for him, that would be illegal. But a supervisor can show favoritism towards certain employees who are his buddies or personal friends. This is not illegal. It would be illegal to treat all Caucasian employees better than all Hispanic employees, or to treat all male Caucasian employees better than all male Hispanic employees.

    5) Great! You should consider taking the lawyer’s advice.

    6) You ask, “why sue the company for the actions of this manager?”. The answer is because the company is legally responsible for the manager’s actions. Either they are unaware of his actions, or they support them. By law, an employer has to train managers not to act in ways that illegally discriminate against employees. If no one says anything, this manager will continue to act this way, and others might imitate him. However, there are some steps that you can take without suing the employer, that might solve this problem. We discuss them below.

    7) That’s good to know. Unfortunately, while prejudice can be subtle, illegal discrimination usually is not. A manager can commit illegal discrimination against Hispanic men and not Hispanic women, and still be breaking the law.

    Here is our recommendation as far as this manager goes: Sit down and make written notes of all the incidents where the supervisor said negative things about Spanish or Hispanic people, or took what you consider to be negative actions based on race. List the date, time and any witnesses who were present. This is so you do not forget any of those incidents. For the present, keep this list separate from the issue of your demotion.

    Address the issue within the company. A company of this size should have a corporate HR office. Many companies will also have a toll-free number or hotline where employees can report illegal discrimination. Contact them and tell them you believe you are the target of illegal discrimination based on sex, race and national ancestry, and of a hostile work environment. They will investigate the issue. If they find the manager has acted inappropriately, they will put an end to it. A discrimination case is much stronger when you bring it to the company’s attention before filing a suit. A good company will immediately reassign the manager, or make him stop this conduct. Even if their investigation determines that this was not illegal discrimination, it will probably end.

    If the company does not address this issue, or the discrimination continues, you should file a complaint of illegal discrimination in the workplace with the federal EEOC at http://www.eeoc.gov. They will conduct an investigation and if they find there is evidence of illegal discrimination, they will sue the employer on your behalf. All of this is at no charge to you. Usually, it does not go this far. Normally the company will cooperate with the EEOC and follow their recommendations to rectify the problem, which may include a promotion, back pay, damages, etc. (After the EEOC investigation, you can hire your own attorney to sue if you would prefer, but then you need to pay the attorney. The EEOC will not investigate any complaint where you have already filed a lawsuit, so always go to the EEOC first.)

    8. We are still not convinced that the demotion was unwarranted. For the time being, you need to find a way to live within your current salary. There is no guarantee that you will ever be promoted or paid more. It is natural that you feel cheated, but in reality, you were being paid more than other people with the same job and there was never a guarantee that the situation would last forever.

    Our recommendation is that you treat the demotion as a separate issue. You can certainly go to HR or call the hotline and tell them that you believe illegal discrimination against male Hispanics was a factor in your demotion, and in you not being hired for the recreated position. (After all, you had unique qualifications for the position.) You would follow the same process. If the company does not resolve this issue to your satisfaction, you can report it to the EEOC. Again, it is illegal for an employer to retaliate against an employee who files a complaint in good faith with the EEOC. Even if the EEOC eventually finds that there was no illegal discrimination in the demotion, the employer cannot take revenge against you. Often employees find that working conditions improve a lot, once the manager realizes that the EEOC is watching.

    Some employers try to make workers feel disloyal for reporting them to HR or the EEOC. In fact, you are doing the company a favor by making the aware of a problem before it results in a multi-million-dollar lawsuit. A well-managed company would want to know this information. HTH, and thanks for reading the blogs!~ Amelia

  6. Hi, Amelia – I work full-time with a company in Ohio. I’ve been employed here for about 7 years, although about 14 months ago, I moved into a new position with this same company. Both prior to and after the move to the new role, I was in a salaried exempt position. I have always received superior performance reviews, including the most recent one received just last week.

    1) Yesterday, I was informed that after a recent company-wide evaluation, my current role was incorrectly classified as exempt, and is changing to an hourly non-exempt position. I was told in no way is this a reflection of my job performance and nothing is to change, except now I will be eligible to receive overtime pay. I believe there are about 3 or 4 other people in my office that are transistioning as well (they share the same job title). My supervisor enouraged me to take advantage of the overtime, in no way suggesting that I restrict my hours. I’m not overly dismayed, as I typically put in more than 40 hours per week.

    2) However – apparently hourly employees are required to have one week’s pay held in reserve until their employment is terminated. So, at the onset of the change, my company will hold one week’s pay, or they have offered to ‘advance’ me the week, but will withhold one day’s pay out of the next 5 consecutive pay checks. This is a major issue for me. I am recently divorced and have four children. Going without a week’s pay, or trying to manage on a temporarily reduced salary will be a real hardship.

    3) I asked my manager if the eligibility for overtime is going to be retroactive to when I started in this role, but of course, the answer is no – even though there is no change to my actual job duties or title. I have always recorded my time, and during my time in this new role, I have put in approx 100 hours of overtime.

    4) Additionally, I’ve had difficultly scheduling and using up all my PTO during this time (which we use or lose), and during my time in this new role I have missed out on taking about 65 hours of PTO. Irrelevant, I know – but just wanted to demonstrate my level of committment to the job. Considering all this, I feel angry about having to meet the requirement of having the week’s pay held in reserve. I love my job (for the most part), and don’t want to make any awkward waves, but I’d like to suggest that they pay me the back overtime – then the missing week’s pay wouldn’t be an issue. Do I have any recourse?

  7. Hi Kelly! There are several issues in your post, so we have numbered them for easier reference.

    1) The employer is acting in a responsible and ethical way by switching you to non-exempt status. Several federal court rulings in the past year have restricted which employees can be exempt. Many companies are being pro-active by switching employees in questionable roles to non-exempt.

    2) This is a common misconception, but in reality there is not a company in the U.S. that holds a week’s pay until termination. It would be illegal to do so. What the employer does, is take a week to process payroll. Example: suppose the payroll week ends on January 7. The employer issues payroll checks for that week on January 14. This gives the employer a week to turn in payroll records, figure overtime and deductions, and cut the checks. If the employer did not do this, the payroll week would end at midnight on January 7 but the employer would be issuing paychecks for that week at 4 pm on January 7. Obviously, it would be impossible to generate accurate payroll checks to hourly employees under those circumstances.

    Some companies do issue paychecks to exempt employees the same day, because their hours do not vary. However, most companies make both exempt and non-exempt employees wait 1 to 2 weeks after the payroll period ends to receive the paycheck. This is normal operating procedure at companies throughout the U.S. and there is really nothing the company can do about it. Even if they wanted to, it is impossible for the employer to pay you on January 7 for the work you did on January 7 as an hourly employee. Every employer has an established payroll procedure with a defined payroll cycle. It would be impossible for them to create a new payroll cycle for a single employee.

    The company is actually being generous by offering to advance your salary for one week and deduct a day’s wages from each of the next 5 paychecks. We suggest that you take them up on that offer. Depending upon how much overtime you work during those 5 weeks, you may not notice much difference in your check.

    3) It is important to remember that this issue is not in any way related to the issue of the pay cycle. The employer is not volunteering to pay you overtime for the past 14 months, but you may be entitled to it. If your company has an HR department, approach them and tactfully ask to be paid for the overtime you have worked in the past, since you took this job. If they refuse, file a wage complaint regarding unpaid overtime with the U.S. Department of Labor at http://www.dol.gov. Also encourage your coworkers to do the same. The Department of Labor will investigate. If they find that you should never have been classified as an exempt employee, they will force the employer to pay you overtime for a maximum of 2 or 3 years. Often, it never goes that far. As soon as the company finds out that you have filed a wage complaint, they may simply pay you and your coworkers the overtime. It is illegal for an employer to retaliate against an employee who files a wage complaint in good faith.

    4) You’re right — you’re a very dedicated employee, but this is unrelated to the other two issues. We will say this: it is probably unwise for any employee to forego using all PTO or vacation time available to them. In the long run, employers do not appreciate it, and it hurts the employee. Studies have shown that employees who use their vacation time are actually more productive. By not using all your PTO, you are only cheating yourself and your family. HTH, and thanks for reading the blogs!~ Amelia

  8. Hi there. I work for a California based, privately held company. Recently they announced that they have scheduled training sessions beginning at 7:30am and running through 8:00pm, which includes dinner. I am an exempt employee and was told that the “bonding” dinner is mandatory. I expressed concern as I have 2 children 8 and 6 and their drop off /pick up and homework requirements. I was instructed to obtain my children’s homework from their schools in advance and have my children do it in advance of the meetings. The drop off issue in the morning, I am unable to drop off my children before 7:45am and pick up is no later than 6 pm. I was told that this is just a part of being a parent and my boss went as far as to tell me that she was able to handle it when she was a single parent and so should I. Though I have a good job, I feel that the company is really overstepping their bounds by infringing on my personal time. I am wondering if this is legal. Since the decline of the market, I find that working through lunch is expected and even though I am exempt, my time is watched and accounted for up to the minute. So I have trouble giving the company any of my personal time. Your thoughts??

  9. Hi Eva! This is a tough situation and you have our empathy. Unfortunately, yes, this is entirely legal in California and every other state. There is no law that an employer must provide a good work/life balance for any employee. By law, the employer must expect the same performance from a single parent as from an employee with no children, or a married employee. Having different expectations would be illegal discrimination.

    You have been accustomed to thinking of the time after 6 pm as “your” personal time. However, from an HR perspective, an exempt employee can be required to work any number of hours per day or per week without additional compensation. The employer could require that you work until midnight every night, and fire you if you did not do so.

    The employer is not overstepping their bounds. Unfortunately, they have the right to unilaterally set your work schedule, and change your work schedule at any time. Your choice is to keep this job or be unemployed. Sorry to be so harsh, but that is the reality of this situation.

    Your employer has informed you that your working conditions have changed and will at times require you to report to work at 7:30 am or earlier, and remain at work until 8 pm or later. The best option is probably for you to find alternate child care arrangements for those times when you need to work earlier or later. The changes you have experienced are not unusual in the current recession. The average exempt employee has experienced a 25% reduction in pay in the past two years, often coupled with an increase in hours worked — and those are the ones who are still employed. So you are certainly not the only one facing these problems.

    Obviously, this job is not a great fit for your personal life, and you should begin to look for a better one. However, you are probably better off keeping this job until you can find something better. HTH, and thanks for reading the blogs!~ Amelia

  10. Hi Amelia,

    Our company (in KY) is planning to have 2 temporary 1 week production shutdowns. The first one to be during the memorial day holiday (05/30 – 06/03) and the second during the 4th of July (07/04 – 07/08). One of the options to do during the time is having a production shutdown with a definite recall date and having employees file for unemployment during these weeks. My question is if we would still need to pay out holiday pay if it is a temp. shutdown for all production employees and plan for them to collect unemployment during this time? Also would this be in violation of any labor laws?

    Thanks
    Kathy

  11. Hi again Kathy! These furloughs would not violate any federal or state employment laws as far as we can tell. Your employees could file for unemployment benefits for the week of each shut-down. This will probably result in a deficit in the company’s unemployment reserve account that will increase your unemployment taxes in the future, but it would be lawful. (You may be able to reduce your unemployment rate by making a voluntary payment, and that may be much cheaper than paying your employees for the two weeks. See the link below.) Of course, to qualify for unemployment, your employees will have to look for a job during the week they are off, and they may be required to look for a full-time job.

    Holiday pay is somewhat of a gray area in this scenario. If you pay workers for Memorial Day and July 4, that amount will be counted as income and deducted from their unemployment benefits for the week. There is actually no law that requires any employer to offer paid holidays to workers. As an employer, you set the policies regarding paid holidays if you choose to offer them. You could certainly change company policy so that employees on a week-long furlough, who did no work at all during the payroll week of a holiday, were not entitled to holiday pay. If you do so, we would advise you to let employees know in writing several weeks before the holiday of this change in policy.

    Our usual qualifier applies here. If the furlough or change in holiday pay has a disproportionate effect on employees in a protected group (race, color, sex, religion, national ancestry, etc.) then it may be de facto discrimination. For example, if this policy results in virtually all of your Hispanic employees losing their holiday pay, while the group of employees who are still paid for holidays are primarily non-Hispanic, that would be illegal discrimination. This is true even if there are other differences between the two groups, such as exempt vs. non-exempt employees. Otherwise, we see no real problems with this plan, and kudos for thinking ahead! HTH, and thanks for reading the blogs. We are always here to answer your questions!~ Amelia

    Read more about this at: http://www.oet.ky.gov/des/ui/emguide/page20.asp

  12. Hi Amelia,

    I am an exempt salaried employee in Colorado. I am trying to understand my rights as a salaried employee. We are required to work 45 hours per week (9 hours per day). If we need to leave early to let’s say go to the dentist an hour or two early, we are required to make up the time. Our boss just recently told us we are to work a 9 1/2 hour day if we take a break. He also just recently told us that he wants us to work more hours and one cannot be devoted to both their job and their family. He has even told me that my having a family is a problem, even though when he brought me in to the office a salaried employee, he was very aware I am married with two children. How much of that is legal?

    My other question is…
    I went to work for my 9 hours on Monday, on Tuesday I went to work feeling awful. Tuesday mornings we have meetings and this is when the above info was brought up. As the day progressed I felt worse and worse, I ended up going home after six hours of work. On Wednesday my condition had not improved and I called into work sick. After a few doctors appointments, blood tests and a CT scan, Thursday I went into surgery to have my appendix removed. I was released from the hospital on Friday with a doctor’s order not to return to work until Monday, in the form of a doctors note which I gave him. However the whole time I was home I was checking email, and doing what could be done from my computer at home, and against doctors orders went to work (for a very short period of time, about an hour, not a big deal) to help my coworkers out since I wasn’t able to help them via email or over the telephone. We do not have a bona fide plan, policy or practice of providing compensation for loss of salary occasioned by such sickness or disability, but we do get one week vacation time per year. Does he have to pay me for the week, or do I have to use my vacation time to compensate for my lost time/wages?

  13. Hi Carly! There are a number of issues in your post and we will address each of them in turn, but everything the employer is doing is legal in Colorado.

    The employer has the right to establish performance expectations for exempt employees, including the schedule and the number of hours worked. In fact, he could require you to work 20 hours per day without additional compensation, and discipline or terminate any employee who failed to do so.

    Many employees think that exempt status means that their work schedule is flexible. This is not true. Exempt status simply means that the employee is not entitled to overtime regardless of how many hours she works per week. Many employers would expect an exempt employee to work a full day and not leave work early unless there is a medical emergency (like an appendectomy!) and to schedule routine dental appointments (for herself or her family) on her days off.

    In terms of saying “one cannot be devoted to both one’s job and family”, it appears this employer is trapped in the 1960s. Most enlightened employers including many larger corporations recognize that even single employees have a family and a personal life, and strive to facilitate a work/life balance because it makes employees more productive over time. So this attitude is antiquated, but it is legal as long as it applies to employees of both sexes.

    If the employer told female employees that they had to choose between their job and their family, but not male employees, that would be illegal discrimination based on sex. If he refused to hire women who were married or had children, but hired men who were married with children, that would also be illegal discrimination based on sex. But we see no indication that is true. Presumably, there were employees of both sexes at this meeting where the employer said he expected everyone to work more hours.

    It is reasonable for the employer to have one set of standards for all exempt employees, and expect workers to meet those standards regardless of whether they are married or single, have children or not. Even though the employer was aware that you were married with two children when you were hired, he has the right to expect the same performance that an employee who was single would deliver. We don’t see any indication in your post that you expect special treatment, but just to be clear, you should not be penalized for having a family, but neither does it entitle you to time off or special consideration.

    As far as the appendectomy, it is just unfortunate that you had this health crisis immediately after the employer told everyone they need to work more hours. You showed dedication by working from home during your recovery. Frankly, the employer should not have allowed you to come to work — even for a few minutes–until you had a doctor’s release, but we will chalk that up to his poor judgment.

    From an HR standpoint, the employer must pay you for the time you missed, but he can require that you use your vacation time for the days missed. The federal FLSA or Fair Labor Standards Act (the law that covers exempt employees) requires that when the employer has no bona fide paid sick leave plan, an exempt employee who misses a full day of work must be paid for that time. That law also requires that an exempt employee who does any work at all during the day, even from home, must be paid for the day. (The employee can be disciplined or terminated for not working the expected hours, but must be paid for the day.) However, that law addresses the amount on the employee’s paycheck — not how that time is tabulated. There is nothing in the FLSA that prevents an employer from deducting a day of accrued vacation when an employee misses a day of work due to illness. In the current business environment at your company, it sounds like if you do not use vacation time, you may be disciplined for missing too much work time — even though it was for a good reason.

    If the employer has 50 or more workers within 75 miles, you may be entitled to unpaid, job-protected leave under FMLA, the Family and Medical Leave Act. The employer would be required to offer FMLA to you within 5 business days. You could not be disciplined or terminated for taking time off for a serious health condition under FMLA. However, FMLA is unpaid. There is no similar law for smaller employers in Colorado.

    There is no federal or Colorado law that an employer has to provide paid vacations to workers. If an employer does provide paid vacations, the employer establishes the policies surrounding vacation time. In this case, the employer has decided that employees must use vacation time for sick leave when they miss a few days of work. That is harsh, but legal if the employee is not covered by FMLA.

    If the employer had different policies for employees of another race, sex, color, religion, national ancestry, etc. then this would be illegal discrimination. However, from what you have told us, this is just an employer with an antiquated view of the business world whose policies are within the law. HTH, and thanks for reading the blogs!~ Amelia

  14. Hi Amelia,

    Thank you for answering my questions. I guess this leaves me with another question. When I return to work Monday I will be required to turn in a time sheet, and in that time sheet I will have to put that I was out sick. I have been saving my vaction time for almost a year and have asked to have a week off in March, which has been approved. (In June I will be eligable for another week.) From this time sheet I know my employer will deduct my pay for the time I was out. We are always deducted pay if we do not reach our 45 hours. Mind you that rarely happens, usually I make up my time over the weekend and then some. How do I go about making sure I get paid for the week? Do I have to volunteer my vacation time that has already been approved to be used in March?

    I have always complied with the rules he changes on a weekly basis, and I am the only woman, and the only employee with kids at home. Very rarely is my family an excuse that I cannot work. The only time I have said I cannot work due to my family is earlier in the morning than I am scheduled to come in, because my husband works nights and is not home yet. I have told him if I am really needed that I can bring them in with me until he can pick them up. He does not have a family and I’m afraid does not have any family values. I have been very dedicated to my job and feel like we are being taken advantage of. I understand that times are hard. I do everything I can for the company. I feel alot of ownership in the company as I have worked there for years. We are an electrical contractor, and I have moved my way up from out in the field (Journeyman electrician) to in the office as an estimator. Everybody is stressed out, working the hours he requires and he keeps threatening all of us with our jobs, that we are replaceable. Sorry I kind of vented to you a bit. Obviously we know that we are replaceable and that’s why we all work so hard.

  15. Hi again Carly! It does sound like these are difficult working conditions and you are going above and beyond the call of duty for this employer. We will assume that the company is too small for FMLA to apply.

    You do not have to volunteer to use your vacation time to cover the days that you were sick. However, if you do not, the employer has the option to discipline or terminate you for “excessive absences” or for poor performance (not working the required 45 hours per week.) That’s not fair, but it is legal. Under the FLSA, you are entitled to payment for the days you were sick, since a) the employer has no bona fide paid sick leave program and b) you worked from home at least a few minutes each day (which you should put on your time sheet.) However, whether or not you are paid is a separate issue from whether you are subject to disciplinary action.

    The employer does not need your permission to deduct accrued vacation time from your balance. He could simply pay you for the time and use your vacation without your permission. In that case, you would not have vacation available to use in March. It may be that the employer would allow you to take a week of unpaid vacation in March. As long as you did no work at all during the payroll week, this would be legal.

    You said that you were an exempt employee, but that may not be true. If the employer regularly docks your pay when you work fewer than 40 hours per week, you may be a salaried non-exempt employee. In that case, you would be entitled to overtime when you work more than 40 hours per week.

    It sounds like the only way you can be confident that you will not be disciplined for these absences is to use vacation time. The other option would be to put down your time honestly without volunteering to use vacation time to cover your absences, and see how this plays out. The employer might require you to use vacation, or might deduct vacation time without your permission. If he pays you less than your full salary for the week, you could file a wage complaint with the U.S. Department of Labor at http://www.dol.gov. They would investigate and determine if you are an exempt employee. If so, they would require the employer to pay your salary for the week. If not, they would require him to pay overtime for the past 2-3 years. Normally we suggest that an employee discuss the situation with the employer before filing a wage complaint, but our impression is that this employer is not a reasonable person and might persecute you for raising the issue.

    It is illegal for the employer to retaliate against an employee who files a wage complaint in good faith, even if it turns out that the employer does not owe any back wages. HTH, and thanks for reading the blogs!~ Amelia

    P.S. We are assuming that you are covered by the federal FLSA, which covers employers with annual revenue of $500,000 or more, or employees who engage in interstate commerce such as using the internet at work.

    Read more about salary basis requirements under FLSA at: http://www.dol.gov/whd/regs/compliance/fairpay/fs17g_salary.pdf

  16. Hello Amelia,

    I have a I-9 related question. I’m a little confused on what to do. I had a new hire fill the I-9, gave me a document from list B & C but on the I-9 form checked off that he is an alien authorized to work and that his card’s expiration date was 06/04/09. He has been run through E-Verify and is authorized to work but is okay that an expired date is listed on the I-9?

    Thanks Kathy

  17. Hi Kathy! Thanks for posting an excellent question. We assume that you examined the documents presented, they appear to belong to this individual and one of them does, in fact, expire on 6/4/09. Generally speaking, documents submitted for the I-9 must be unexpired. To quote from the DHS Employer Handbook, “You may not specify which document(s) an employee must present. However, you may only accept unexpired documents.” Even if an employee who was born in the U.S. submitted an expired driver’s license, it would be illegal for you to hire the individual.

    This is complicated by the fact that the USCIS has issued extensions for work authorization documents for individuals from several countries. So, in a few cases, the expiration date on the card is no longer the actual expiration date. Usually this applies to individuals who have been granted Temporary Protected Status. For example, here is an 18-month extension for refugees from Somalia, which was issued in Nov. 2010: http://www.uscis.gov/portal/site/uscis/menuitem.5af9bb95919f35e66f614176543f6d1a/?vgnextoid=f47fae8ac980c210VgnVCM100000082ca60aRCRD&vgnextchannel=c94e6d26d17df110VgnVCM1000004718190aRCRD (Sorry about the long link.)

    E-Verify basically checks to make sure the documents presented match USCIS and Social Security records, reducing the chances of identity theft or fake documents. An expired document will often pass E-Verify. This verifies that the expired document belongs to the employee. It does not entitle the employee to work on an expired document.

    Your first step is to sit down and speak with this individual. Let him know that the way he has currently filled out the I-9 indicates that it is not legal for him to work in the U.S., or for you to hire him. Ask him in a non-threatening way, to clarify this, “Carl, can you help me understand how this is filled out? Because the form shows that your work authorization expired on 6/4/09. That would mean that I cannot legally hire you.”

    We suspect that the answer will be that he hoped you would not notice that the work authorization was expired, or that he needs to renew it and has not done so. In either case, you need to let him know that he cannot work until you have the proper documentation, and he fills out a new I-9 showing that it is legal for him to work today — not that it was legal for him to work in 2009. If he says that the deadline of the document has been extended, you need to verify that on the USCIS website, print out a copy of the extension and attach it to his I-9 with a note.

    You need to not schedule this employee to work until this is resolved. He has completed an I-9 that says he cannot legally work in the U.S. at this time. By allowing him to work, the company is intentionally breaking the law by hiring an undocumented worker. HTH, and thanks for reading the blogs!~ Amelia

    Find the entire I-9 form including instructions here: http://www.uscis.gov/files/form/i-9.pdf
    The I-9 Handbook for Employers is here: http://www.uscis.gov/files/form/m-274.pdf Pay particular attention to Section 8, which lists the documents that can be accepted. In every case, the handbook specifies in the heading that “All documents must be unexpired.” This applies to all documents from columns A, B and C.

  18. Work for a company in TX, I was hired on as a salary (Exempt) position since 2008, now, our GM is trying to make changes from a previous Employer we both worked with prior to this company, the changes he is trying to make is my position to Non-Exempt since I have no one that works/reports to me. Can they change my position? It seems I will be the only change for this company at this location.

  19. Hi Daisy! Yes, an employer can pay you on an hourly or non-exempt basis. It is legal to treat any employee as non-exempt.

    It may be that your job duties never qualified you as an exempt employee, anyway. In that case, you would be entitled to overtime for the past 2-3 years. HTH, and thanks for reading the blogs!~ Amelia

  20. I have worked for a construction company for 4 years. I work in a service department as a warranty technician, I have been paid as an exempt employee and after reading state laws I do not think that I am exempt. What do you recommend.

    Also yesterday my employer told us (4) that we are being moved from salaried to hourly which is fine but are there any issues that I should think about.

    After the employee meeting I was called into the owners office and told that they were reducing my pay from 85,000 to 75,000. They told me that it was because I am paid at a much higher rate than my co workers, and because when they hired me they thought that I would bring in more customers which was their justification for the higher pay. I have brought in several customers and several potential customers.
    Lastly would I qualify for unemployment benefits if I do not take the wage reduction?

    Thank you
    Brian

  21. Hi Brian! If you believe that you should never have been an exempt employee, then you may be entitled to overtime for any payroll week in which you worked more than 40 hours, in the past 2 years. You could file a wage complaint with the state or federal department of labor.

    There are probably not an issues that you should consider in accepting hourly status, since you believe you are not exempt anyway. However, be aware that if you sometimes work less than 40 hours per week, the employer can pay you for only the hours you work.

    Usually an employee who quits rather than accept a significant change in working conditions or a significant reduction in wages qualifies for unemployment benefits. It is not clear if a reduction from $85,000 per year to $75,000 per year will qualify. If you work even one day under the new arrangement, you have accepted it. If you quit after that point, you do not qualify for unemployment benefits.

    The salary reduction was probably not personal. Many employers are taking a closer look at any wage disparities in similar jobs. This is partly because the Ledbetter Act now gives an employee up to 20 years to sue for pay discrimination. The employer wants to be sure you are being paid about the same amount as your coworkers, to avoid being sued by them in the future.

    Our recommendation is that you accept the new position while looking for a better job. HTH, and thanks for reading the blogs!~ Amelia

  22. Amelia,

    Thanks for the feed back.
    I also forgot to mention that I was recently diagnosed with Rheumatoid arthritis which can occasionally affect my work, do you think I should be concerned that by them singling me out that they may be trying to get rid of me?

    Again thanks

    Brian

  23. Hi again Brian! You are very welcome! No, we genuinely think that they are concerned about the disparity in salaries. Since the Ledbetter Act was passed in early 2009, many companies are taking similar steps to ensure that people with similar jobs are making the same amount. There is huge potential liability for them if they are paying you $85,000 and only paying the other employees $75,000.

    There is no need for you to disclose your diagnosis of Rheumatoid Arthritis to the employer unless you need an accommodation under ADA. (You can even take FMLA without disclosing the diagnosis to the employer.) Even if you have already shared your diagnosis with them, it is illegal for the employer to consider your disability as a factor in employment decisions. If they did so, you would have a good case of illegal discrimination based on a disability.

    But from what you have told us so far, this does not seem to be the case. It genuinely seems to be a case where the employer has decided that all the employees in your job should be hourly, and should be paid a similar amount. HTH, and thanks for reading the blogs!~Amelia

  24. Well I do see your point however of the 4 of us in this department, I know that 1 is being paid about 40k one is at about 50k I was at 85k and I am pretty sure the 4th is paid around 80k

    I think that I am going to have to seek an attorney prior to going back to work there are far to many issues and I am afraid of returning and accepting this pay decrease if it is not legal.

    Do you have any recommendations on seeking council for this type of mess?

    Thanks Brian

  25. Hi again Brian! If you are looking for an attorney, we recommend one with NELA, the National Employment Lawyers Association at http://www.nela.org/NELA/. However, be aware that in most states it is legal for an employer to reduce any employee’s wages at any time, as long as the employee is informed in advance, and there is a valid business reason for doing so, rather than it being done for reasons of illegal discrimination.

    If you have a strong case, you should be able to find an attorney who will represent you with little or no money up front.

    If you believe that this wage reduction is illegal discrimination based on a disability or perceived disability under ADA, then your best bet is probably to continue working and file a discrimination complaint with the EEOC at http://www.eeoc.gov. They will investigate. If they find evidence of illegal discrimination, you will have the option of paying a lawyer or allowing the EEOC to sue on your behalf. The EEOC will not become involved if your lawyer has already filed a suit.

    Assuming that all four of the employees in the department are doing similar jobs, it would seem that the two who are making less than $55k have an excellent case for discrimination. You and the person earning $80k…not so much. But by all means, consult an attorney. HTH, and thanks for reading the blogs!~ Amelia

  26. Company didn’t want to give me a raise on the books so they were forcing me to forge a monthly mileage report in order to get money. Is this legal ? I never drove to any of our 10 retail stores but that was the only way they would pay me.

  27. Hi Rick! You may have been committing a crime but the company probably was not. The employer’s conduct was unethical and very unusual. We suspect that upper management believed the mileage reports were genuine. Otherwise, this policy really doesn’t make any sense.

    There is no state or federal law that specifically prohibits an employer from paying workers for mileage. This is true, even if the employer knew that you were not driving and therefore not entitled to reimbursement. However, the crime of fraud occurs when someone lies for monetary gain. In this case, you were probably committing fraud by signing and filing false mileage reports. Even if your boss asked you to do so, it is still illegal. However, since this was sanctioned company policy, it is unlikely that you would be prosecuted.

    Most companies would fire any employee who falsifies company documents (milegage reports) or urges another employee to falsify documents. But that does not make the employer’s conduct illegal. HTH, and thanks for reading the blogs!~ Amelia

  28. if I was moved from a Salary position to an Hrly Position, you had mentioned that i would be intitled to 2-3 years back of any OT hrs. correct? Now, lets say I were to bring this up to Mgmt, since I was moved to Hrly pay can I get fired for claiming this?

  29. Hi daisy! Being changed from salaried to hourly does not necessarily entitle you to overtime. However, the federal regulations on who qualifies as an exempt salaried employee are strict, and they are based on primary job duties, not title. If your past job duties did not meet the standard for an exempt employee, then you are entitled to overtime under the federal FLSA, the Fair Labor Standards Act.

    Normally if you file a wage complaint, the U.S. Department of Labor will investigate. If they determine that you are owed overtime, they usually force the employer to pay back wages for 2 years. However, if the DOL determines that the employer intentionally conspired to deprive you of the overtime you were legally entitled to, they may force the employer to pay back wages for 3 years. If necessary, the DOL will sue the employer for you.

    So basically:
    Employer made an honest mistake = 2 years of past due overtime
    Employer intentionally broke the federal overtime law = 3 years of past due overtime

    It is illegal for an employer to retaliate against an employee who files a wage claim in good faith — but the employer can still fire you for being rude or insubordinate. Your first step would be to tactfully sit down with your manager or HR privately, and let them know that you believe you were never an exempt employee, and are entitled to overtime for the past 3 years. No matter what the employer says, you should remain polite.

    Theoretically, it is illegal for the employer to retaliate against you for this — so no, they legally cannot let you go for this reason. However, sometimes it does happen. If your employer is completely unreasonable, you should skip this step and go directly to the next one.

    If the employer refuses to pay you overtime, you can file a wage complaint with the U.S. Department of Labor at http://www.dol.gov. They will investigate, and if they find you were never genuinely an exempt employee, they will require the employer to pay you overtime. This is a complex situation, so feel free to post any additional questions you might have. HTH, and thanks for reading the blogs!~ Amelia

  30. Thank you for all your responses! one more question??? At date of hire my job title is considered as an EXEMPT position, then later on took another workload added to my duties which is a NON EXEMPT position….in the job descriptions it does indicate NON EXEMPT and EXEMPT. I guess my question is shouldn’t they keep me in EXEMPT position?

  31. Hi daisy! You are very welcome. We are always here to help.

    In terms of your question “shouldn’t they keep me in an exempt position?” the answer is no. In fact, they might be required by law to switch you to non-exempt status, if your job duties change.

    When an employee is hired, the offer letter or other information presented is not a lifelong contract. It is merely a statement of the job conditions and policies at the time the employee is hired. The employer can change them at any time.

    Under the federal FLSA, an employee’s job duties must meet certain requirements in order for the employee to be exempt. Status (exempt or non-exempt) is based on how the employee actually spends her time — not on a title or job description.

    It is always legal to treat an employee as non-exempt. Even the CEO of a company can be non-exempt. However, the employer breaks the law when they treat a non-exempt employee as exempt. So, it makes sense for the employer to err on the side of caution. When combining two jobs, one exempt and one non-exempt, it makes sense for the employer to treat the new position as non-exempt. The employee would then be entitled to overtime in the new position, when she works more than 40 hours per week. HTH, and thanks for reading the blogs!~Amelia

  32. Amelia-

    I have an exempt salaried employee that works our company. The employee suffered a nervous breakdown recently. The employee was off work for a week, under Dr. orders and then was released to return to work for 1/2 days until seen again by the Dr.

    As salaried employees we do not have sick days. The employee took a week of vacation pay during the off week. The employee has since seen the Dr again and has another note saying 1/2 days until seen again….the total time period covering this event has been 5 weeks..

    Since the salary paid to the employee is based on a 40 plus hour week (5x 8hrs plus 4 hours every other Saturday) and the employee is limited to 20 hours per week while under Dr. care…can we as the employer: A) request that the employee take FMLA until the employee is able to work the full time schedule..or B) reduce the employees salary in proportion the the hours that the employee is available to work..(thus making the employee non exempt now ) then reinstating the full salary when the employee is ready and available to work hours again..

    It is our feeling if we do not do something that this 1/2 scenerio could be stretched out for a considerable time period… Thanks

  33. Hi Eric! Many employers would say that the part-time schedule has already been stretched out for a considerable time!

    Mental illnesses of various sorts are usually a serious health condition under FMLA. Depression, bipolar disorder, schizophrenia and the like are often also a permanent disability under ADA (although some conditions like anxiety disorder may not be.) Normally an exempt employee must be paid his full salary every week, regardless of the number of hours worked. However, both FMLA and ADA permit you to prorate the exempt employee’s salary.

    This is exactly the type of situation that intermittent FMLA was designed for.

    Yes, you can put this employee on FMLA. In fact, as an employer, it was your legal responsibility to inform this employee of his (or her) rights under FMLA within 5 business days of the first absence — meaning the first week he was off. Because you did not do so, you should do so now. The employee can use intermittent FMLA 20 hours per week. Since FMLA is unpaid, you will pay the employee only half of his usual salary each week. (You could have done this from the start, but apparently you chose not to.)

    So the answer to question A) is yes, you can designate this as FMLA.

    The answer to question B) is a little more complex. You cannot legally use the employee’s mental illness as an excuse to make him a non-exempt or hourly employee. That would be illegal discrimination based on the employee’s medical condition, under ADA. However, after the employee uses all his hours of intermittent FMLA, you can require that he return to the job full-time or be terminated. FMLA requires only that an employee be permitted to use 12 weeks of leave. That would be 24 weeks of working half days.

    If the employee is still unable to work full days after has exhausted all his FMLA, he can request a modified schedule as a reasonable accommodation under ADA, the Americans with Disabilities Act. You cannot impose an accommodation on an employee — he must request it. As an employer, you have the right to decline any accommodation that is an undue hardship — but it appears that this is not an undue hardship, since you are already granting it. An exempt employee’s salary can be prorated based upon the number of hours worked in the payroll week. So he might be entitled to permanently work 20-hour weeks as an accommodation for a disability, depending upon his actual diagnosis.

    Two other things to keep in mind: Under ADA, any medical information disclosed by the employee must be kept confidential, even from the employee’s supervisor. You absolutely cannot reveal anything about this employee’s condition, even that he is “doing better”. The information must be kept in a separate confidential file and never discussed with anyone. It cannot be a factor in making employment decisions like promotions, training, lay offs, etc. His supervisor and others making employment decisions should not have access to the confidential file.

    You also mentioned that your exempt employees do not have sick days. Under the FLSA, when an employer has a bona fide paid sick leave program, and an exempt employee uses all his sick leave, he need not be paid for any additional sick days. However, when the employer has no bona fide paid sick leave program, exempt employees who are absent less than a full week due to illness, are always entitled to payment for those days. The employee must be paid his or her usual salary for the week, unless the exempt employee is absent for the entire payroll week. This would be true even if the employee had no vacation or personal time available.

    These are complex issues, so feel free to post any additional questions. HTH, and thanks for reading the blogs!~ Amelia

  34. Hello,

    If we have employee(s) that travel to Guam since we have a facility in Guam, when we send employees to work at that facility its almost 20 something hrs to get there, how does that employee claim hours? is that employee only allowed to get paid 8 hrs since that is our work schedule or is that employee allowed to get paid the full hrs of travel?

  35. Hi daisy! If the employees are exempt, travel time is irrelevant. The employer is entitled to his or her full salary each week, and nothing more, regardless of the number of hours worked or spent in transit.

    Hourly employees on an assignment away from home that requires an overnight stay are covered by the federal FLSA or Fair Labor Standards Act. The FLSA requires the employer to pay workers for travel that occurs during the employee’s normal work hours. Suppose an employee normally works from 8 am to 5 pm. If he is a passenger on a plane between 8 am and 5 pm, he is paid for that time. Even if the flight lasts until 10 pm or 5 am the next morning, the employee is entitled to payment only for the portion of it that is within his normal work day.

    However, the employee is also entitled to payment for additional travel that occurs during the work day, such as taking a taxi to the airport, waiting at the airport, traveling to the hotel, etc. Bear in mind that if the travel lasts into another day, the employee is entitled to payment for travel during that work day, as well. If the total trip takes 33 hours beginning at 8 am Monday, the employee who usually works 8 am to 5 pm is entitled to payment for 16 hours (8 am – 5 pm, Monday and Tuesday.) Usually this is calculated based on the time in the employees home time zone, not the destination time zone.

    In addition, driving is work under the FLSA. So the employee is entitled to payment for any time spent driving, even if it is outside his normal work hours.

    Bear in mind that this is the minimum that your company must pay workers under federal law. You can certainly opt to pay employees more hours for longer flights. We agree that the flight to Guam is very long and it would be more fair to hourly employees for you to pay for the entire flight. However, there is no federal law that requires you to do so. HTH, and thanks for reading the blogs!~ Amelia

  36. I worked for same company for three year,when i stared @14.00 an hour but I have not recived a raise. I live in california is that legal….

  37. Hi sally! Yes, that is legal. As long as the employer is paying at least the minimum wage, they never need to give an employee a raise. in some states if the employer promised a raise, especially in writing, they must keep that promise. HTH, and thanks for reading the blogs!~ Amelia

  38. Hi Amelia,

    I work for a company in KY. We have an employee that has been out on Workers Comp since the beginning of April. The employee had surgery on one issue but also strained his shoulder. The employee has received Physical Therapy for his strain and that has not helped. I’m not sure that the employee intends on returning to work. Are we required to hold his position? Can we legally terminate this employee?

  39. IS THIS LEGAL?

    Salaried exempt employees are paid on a salary basis and, in general, must be paid their full salary for any week in which they perform work. Their salary may be reduced only in the following circumstances:

    1. Employees who are absent from work for at least a full day for personal reasons other than sickness or disability, and have exhausted their PTO will not be paid for that day.
    2. Exempt employees who are absent for at least a full day because of sickness or disability, and have exhausted all their PTO will not be paid for that day. Their salary will not be reduced for less than a full day because of sickness or disability.
    3. Employees who are absent from work for jury duty, attendance as a witness or military leave may have their salary reduced by the amount of payment they receive in the form of jury fees, witness fees or military pay. Their salary will not be reduced by the number of hours or days they are absent unless they perform no work during a given week.
    4. If an employee violates a rule of major significance, his/her salary may be reduced in an amount to be determined by the Company as a penalty for that violation.
    5. Employees who work less than forty (40) hours during their first and/or last week of employment will be paid a proportionate part of their full salary for the time actually worked.
    6. Employees who take leave under the Family and Medical Leave Act will not be paid for that time unless they have accrued PTO under the Company’s paid time off policy. Their salary will be reduced by the hours missed, even if it is for less than a full day.

  40. Hi Marilu! Unfortunately, we are shutting down the comments section of this blog. Our staff will continue to respond to questions or concerns posted as comments on http://www.humanresourceblog.com. You can post your question or comment there. HTH, and thanks for reading the blogs!~ Amelia

  41. Hi Jennifer! Unfortunately, we are shutting down the comments section of this blog. Our staff will continue to respond to questions or concerns posted as comments on http://www.humanresourceblog.com. You can post your question or comment there. HTH, and thanks for reading the blogs!~ Amelia

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