labor lawAdivision of labor law center

One of the hottest HR topics right now is salary reductions for exempt 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 hourly employees. By having every hourly employee 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 Fair Labor Standards Act, or FLSA, 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 California have different exempt employee laws.

 

 

Last 10 posts by Amelia

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1. Posted by: John

   Can an employee be held as a 36 hour (3X12hr shift per week) listed as exempt? Then be required to report for meetings during non scheduled times and not be paid anything for the meeting time?

2. Posted by: Amelia

   Hi John! Yes. There is no requirement that exempt employees work 40 hours per week. The number of hours required per week is up to the employer, to establish for each exempt position. While most exempt employees work 40 or more hours per week, an employer can certainly hire an exempt employee to work 20, 30, or 36 hours per week — or any other number of hours. (Under federal law, the exempt employee must earn at least $455 per week.) And yes, an employer can require that an exempt employee attend meetings on his or her day off, without additional pay. (The exempt employee could even be required to work additional 12-hour days, with no additional pay.) If the employee does not attend the meetings, the employee can be disciplined or terminated. HTH, and thanks for reading the blogs!~ Amelia

3. Posted by: Rob Whitters

   If I was hired as both the site lead for my team in California and as the Modeling and Simulations lead. If my company decided to split these two positions can they subsequently reduce my salary or are they obligated to continue to pay what I was hired at? My company is based in Washington and I am working on a government contract.

4. Posted by: Amelia

   Hi Rob! Because you have a contract with two states and the federal government involved, it may take an attorney to determine your rights in this situation. However, in general, an employer can reduce an employees salary when the job changes. (Actually, the employer can reduce the workers salary even if there is no change in job description, but that is another topic.) In many cases, when an employees salary is significantly reduced, and the employee quits rather than accepting the lower salary, the employee qualifies for unemployment benefits. However, if the employee continues to work at the new rate, he or she has accepted it and does not qualify for unemployment. HTH, and thanks for reading the blogs!~ Amelia

5. Posted by: steve

   I am an exempt employee working 40 hrs a week-paid a salary based on per hour. No overtime pay is allowed since exempt. My hours were reduced to 32 hours a week which was to be considered permanent. My salary was reduced likewise based on the same amount per hour–still an exempt employee. I am still considered full time at 32 hours a week for benefit purposes. Thus no change in benefits.
   Each office is independent but there are many offices. Other individuals with same responsibilites were not given reduced work ours and treated the same way. I accepted the change for reduced work and salary. According to federal law for salary employees-does it require the company to treat all employees in same classification and responsibilities the same?

6. Posted by: Amelia

   Hi steve! Employers are permitted to treat workers in the same classification differently, if there is a valid business reason for doing so. For example, a retail operation might decide that a store with $100,000 in sales per month only requires the manager to work 32 hours per week, while a store with $200,000 in sales per month requires a manager who works 40 hours per week. This would be lawful.
   However, if the employer decided to reduce your salary based on your race, color, religion, age (between 40 and 70), sex, pregnancy, or disability, that would be illegal discrimination. If you think that occurred, you should contact the EEOC to file a complaint at http://www.eeoc.gov. HTH, and thanks for reading the blogs!~ Amelia

7. Posted by: Andrew

   What is the maximun total hours that an employer can have a salaried manager work per day? per week??

8. Posted by: Amelia

   Hi Andrew! We can guarantee you are not going to like this answer, but here goes…there is no maximum in most states. An employer can require an exempt employee to work 120 hours per week or more. In fact, theoretically, an employer could require an exempt employee to work 24 hours per day, 7 days per week. Obviously, that is physically impossible, but there is no law in most states to prevent it. HTH, and thanks for reading the blogs!~ Amelia

9. Posted by: Eric

   Sorry for digging up such an old post, great blog. My interest is in the legality of changing an employee’s status from exempt to non-exempt when the job responsibilities do not change.

   In January we were told that starting Feb.1 that we would changing to a reduced work week of 4-day weeks, 32 hours. Consequently, my salary was reduced by 20%. After checking my pay-stub, I noticed that I was changed from an exempt employee to a non-exempt. This was never part of the communication from HR. We were told that in 6 months the situation would be re-evaluated. To me this means temporary.

   Would you recommend that I seek the advice of a labor attorney? I had read somewhere that when you change from exempt to non-exempt, any overtime from some number of previous years (3?) could be retroactively requested as a grievence. In my case it would be hundreds of hours each year.

   Thanks!

10. Posted by: Amelia

    Hi Eric! This sounds legitimate to us. There is no law that any employee must be exempt. Any employer can make any employee, including the CEO, exempt at any time. The employee does not necessarily have to be told that the change is being made, although it would be a best practice.
    Changing an exempt employee to non-exempt status does not entitle the employee to payment for overtime for the past 3 years in a situation like yours. The employer has changed the job, which is lawful, especially if it applies to a number of exempt employees.
    When an “exempt” employee is suddenly treated as a non-exempt employee, with no change in working conditions or job, that can result in liability.If the employer kept switching the employee back and forth, from exempt one week to non-exempt the next week, the US Department of Labor would see that as an illegal attempt to avoid paying overtime. The DOL would probably sue the employer and determine that the employee wa never an exempt employee. The DOL would require that the employee be paid overtime for the past 3 years. However, that is not the case here. The employer made a formal announcement that they were changing the job — even though they failed to inform you that you were now non-exempt.
    You may define a change that lasts 6 months as “temporary” but the US Department of Labor defines any salary change that lasts 3 months or more as permanent. So the employer handled this properly. In their defense, many, many employers are taking this step to avoid laying employees off.
    You can certainly seek the advice of a labor law attorney, but frankly, you would just be throwing your money away if you filed a lawsuit. HTH, and thanks for reading the blogs!~ Amelia

11. Posted by: Julie Wright

    Who many days can a salary employee work before a day?

12. Posted by: Amelia

    Hi Julie! Sorry, we’re a little unclear on what your question is. Could you repost it?Thanks~ Amelia

13. Posted by: Vaughn

    Do the salary reduction restrictions apply to “draws” against commission? I have recently had my draw completely suspended until my business picks up. The company said they will re-evaluate in 3-4 months, though by that time I will be in the poor house. Also, the company has a zero tolerance policy (unofficial) to lay-offs due to (I’m sure) paying unemployment insurance premiums…do I have any legal recourse?

14. Posted by: Neal

    I am an exempt employee (Chemical Engineer), with 29 yrs at my firm. This year, my employer gave us 2, 1 week furloughs (1 week in 2nd and 1 week in the 3rd quarter). Because this was a furlough, we were entitled to apply for unemployment pay.

    However, in the 4th quarter, they are planning to reduce our pay 10% for 10 weeks, and reduce our hours by 10%. The effect is the same as a one week, 40 hr furlough, with the disadvantage of not being entitled to any unemployment pay.

    Is this legal?

    Thanks.

15. Posted by: Amelia

    Hi Vaughn! No, commissions are not salary. Therefore, most regulations regarding salary do not apply to them.
    Check with your state department of labor regarding the salary requirements for commissioned salespeople. Under federal law, generally they must be paid at least $455 per week. In many states, an employee who quits due to a significant reduction in salary or change in working conditions, qualifies for unemployment.
    We are not clear what you mean when you say that the company has zero tolerance towards layoffs. That the company is not laying people off? Great!
    Many companies have a policy of routinely denying every unemployment request. The employee can appeal the decision, and may win benefits upon appeal. HTH, and thanks for reading the blogs!~ Amelia

16. Posted by: Amelia

    Hi Neal! It is legal for the employer to unilaterally reduce a salaried employee’s wages permanently, as long as the employee is informed in advance. The employer can do this without any corresponding reduction in hours worked. (And most salaried employees across the country have had reductions of at least 15% over the past year.)

    It is also lawful for the employer to reduce the hours worked at the same time, as long as the reduction is considered permanent. Legally, the federal regulations define “permanent” as “lasting every pay period for 3 months or longer.”

    So it looks to us like the employer’s actions are lawful. The only problematic part is the fact that employees apparently are being encouraged to see this reduction as temporary.

    An employee whose salary is reduced does not qualify for unemployment. When employees collect unemployment benefits, it increases the employer’s unemployment insurance premiums (sometimes for years.) So, the employer is trying to save on payroll without paying higher unemployment — which is a reasonable, prudent and responsible step for them to take.

    When an employee’s salary is significantly reduced, and the employee quits rather than accept the reduction, in some cases the employee qualifies for unemployment benefits. However, it is not clear that a 10% reduction would qualify.

17. Posted by: Julie

    I am a store manager ( exempt) we are not allowed to take vacation doing Nov - Dec I wants to go on vacation Dec 27 thru Jan3 can i get fired, I do not have a contract

18. Posted by: Amelia

    Hi Julie! Yes, you can be fired for taking an unauthorized vacation. Suppose one of your employees did not show up for 10 days beginning the day after Thanksgiving. Would you fire him or her? Of course you would. It’s the same situation.
    There is no law that an employer must offer paid vacations to workers. If the employer does offer a paid vacation, the employer can dictate when the employee takes it. Most employers require advance approval of vacation, and limit when the vacation can be used. Some employers even tell workers, “You will take vacation from July 15 to July 22″ or whatever. HTH, and thanks for reading the blogs!~ Amelia

19. Posted by: Barbara

    Can you please explain exempt salaried employees under this circumstance - Can you be an exempt salaried employee who was working 40 hour work weeks with X amount of pay and then ALL exempt salaried employees work a 32 hour work week and a 20% pay cut. All benefits will still be paid at 100%, although vacation and sick leave will be pro-rated based on a 32 hour work week and not a 40 hour work week.. What will the employer need to do to apply this and how much notice to the employees? Thank You.

20. Posted by: Amelia

    Hi Barbara! Yes, this is a very common situation in the current economy. In fact, the majority of companies have had to reduce salaries for at least some employees.
    The salary reduction is really not a problem as long as every exempt employee is still paid $455 per week or more. An employer can unilaterally reduce an exempt employee’s salary as long as employees are informed in advance. Different states require varying amounts of notice, but the best practice is to inform employees one full pay period in advance that their salary will be reduced. And this reduction can take place with no corresponding reduction in hours worked.
    In fact, the reduction in hours worked is more of a problem than the salary reduction. Under federal law, an exempt employee’s salary cannot vary from week to week based upon the number of hours that he or she works. However, the federal courts have found that as long as the reduction in salary and hours lasts for at least 3 months, and is not presented to the employees as temporary, it is lawful.
    Most companies already have a policy in place that vacation or sick pay will not be paid in excess of the employees scheduled hours — in this case, 32 per week.
    The employer could still offer other benefits such as group health insurance at the same level as previously. If you have additional questions, feel free to post them. HTH, and thanks for reading the blogs!~ Amelia

21. Posted by: Vicki Gorin

    During my absence from the office due to FMLA one of our employees had their salary reducted by 10% for disciplinary purposes. This is a long-term employee with approximately three counseling forms on record. However, the employee received no advance notice of the salary reduction, no other employee has ever experienced a salary reduction due to disciplinary measures and there are employees on file with 8 to 10 counseling forms on record. What do you suggest?’

    I am the VP of HR and the only person willing to follow the standard labor guidelines but am not sure how to proceed in this case.

22. Posted by: Amelia

    Hi Vicki! There are 3 major concerns here. 1) Unless this individual’s transgression was especially egregious, singling him or her out for a salary reduction creates a situation where that employee could sue the company for illegal discrimination and win. The employee, of course, would claim that it was his or her race, color, religion, national ancestry, sex, etc. that resulted in this employee’s salary reduction when employees with 8 counseling forms did not experience the reduction.
    2) It was unlawful to reduce the employees salary without notifying the employee in advance.
    3) Under the new Ledbetter Act, any pay disparity between sexes can set the company up for a lawsuit, even 20 years later. So this decision could be a time bomb, if workers of a different sex in a similar position are making more money.
    We suggest that you present these concerns to those who made the decision in your absence, and propose a compromise. The employee’s salary would be reinstated (perhaps retroactively.) This performance issue would be addressed on the employee’s next regularly scheduled evaluation, perhaps resulting in no salary increase and a lower rating. (If the employee’s conduct was especially egregious, we would have suggested an unpaid disciplinary suspension of 3 to 10 days at the time. However, imposing the suspension at this time is also problematic.) HTH, and thanks for reading the blogs!~ Amelia

23. Posted by: Harold H.

    I realize employers are not required to give holidays.

    I am an exempt employee. My company is requiring us to take Monday, Tuesday and Wednesday of the Thanksgiving week off without pay. They are paying us for Thursday and Friday as holidays. Can I get paid for a partial week?

24. Posted by: Amelia

    Hi Harold! What the employer is doing is entirely lawful and even generous. Your are being paid for a partial week — you are being paid for Thursday and Friday as holidays. Assuming that you do no work at all during that payroll week, the employer could pay exempt employees nothing for the week.
    There is no law that prohibits an employer from paying an exempt worker for a partial week. There is a law that prohibits an employer from paying an exempt employee from a partial week of WORK. (There are a few exceptions to that law, that don’t apply here.) Since you did not WORK at all that week, the employer’s actions are lawful.
    If you worked one day that week, such as Monday, the employer would have to pay your usual salary for the entire payroll week. But paying an employee for a holiday is not the same as the employee working. HTH, and thanks for reading the blogs!~ Amelia

25. Posted by: Paige

    Amelia, just found this post.
    Can an exempt employee who has already taken a 25% salary reduction be forced to take another 20% reduction–totalling 45%? And what is the maximum percentage of “pay cuts” allowed? (i.e. can a company force a salaried employee to take a 80% paycut?)

26. Posted by: Amelia

    Hi Paige! Okay, first of all, an employer cannot “force” an employee to accept anything. The employer informs the worker of the pay cut, and the employee decides if he or she will work for the new wage. Usually an employee who quits rather than work for the new lower wage is entitled to unemployment benefits. However, if the employee works even one day at the new rate, the employee has accepted it.
    There is no maximum percentage for the reduction. The employer can reduce an exempt employees salary to $455 per week. Employees who earn less than $455 per week are never exempt — they are always entitled to overtime. But outside of that restriction, there is no limit on the percentage or dollar amount of a pay cut. Suppose Jane earns $250,000 per year. The employer could reduce her salary by 90.536%, to $23,660 per year (or $455 per week) and Jane would still be an exempt employee. As long as the employer informed Jane of the change in advance, it is lawful.
    However, if the employer reduced Jane’s salary to $454 per week, then Jane would be entitled to overtime when she works more than 40 hours per week.
    Nationwide, most salaried exempt employees have taken a pay cut of about 22% since July 2007, but the amount is greater in some industries. HTH, and thans for reading the blogs!~ Amelia

27. Posted by: Bo

    The company I work for changed our pay period from twice a month to every two weeks. With that change came a reduction in my salary. I was recieving 24 checks per year and now I will be receiving 26 checks a year. The company reduced my salary so that the 26 pay checks equal the 24 pay checks. They notify us about the change bimontly to biweekly. The managers never notified us about the change in salary.

28. Posted by: Amelia

    Hi Bo! This is not a reduction in salary. Your paycheck is for less each payday. But since you are paid 26 times in the year instead of 24, you will earn the same amount each year. It is lawful for the employer to do this, and they even followed the best practices in HR.
    When the company informed you that from now on you would be paid every 2 weeks instead of twice per month, a reasonable person would have assumed that each paycheck would be slightly less. If your paychecks were the same, the company would actually be giving you a substantial raise. HTH, and thanks for reading the blogs!~ Amelia

29. Posted by: len

    amelia,

    I want to ask about the company where my husband works.. He is a 5 years working in the company. And now, the problem is last month his salary was reduced to 43% without any reason. His co-employees are receiving the same salary except him. He tried to talk the management regarding his problem but until now there is no answer to his complaint..

    Is this legal for a company to reduced the salary in one of his employee without any reason? I need some advice from you…

    thanks a lot,

    len

30. Posted by: Amelia

    Hi len! Unfortunately, if your husband knew about this reduction in salary in advance, it is legal.
    An employer can reduce any employee’s salary at any time, as long as the employee is informed in advance of the new rate. Some states require that employees be notified several weeks in advance, but in other states even a one-day notice is enough.
    Many companies are reducing all employee’s salaries in these tough economic times, because the alternative is to lay off employees. However, usually this type of salary reduction affects everyone — not just one person.
    It is possible that your husband has been demoted. In that case, the employer found your husband’s performance was lacking, and changed him to a lower-paying job. If that is the case, there is little that you can do about it at this point. (Is it possible that your husband knows this, and just doesn’t want to tell you?)
    However, if your husband’s performance is good and he has been unfairly targeted for this rather large reduction in salary, that may be illegal discrimination. For example, if your husband were the only Hispanic employee (or the only Hispanic manager), and the only one to receive a salary decrease, that would be illegal discrimination. If that is the case, he should file a complaint with the EEOC at http://www.eeoc.gov. HTH, and thanks for reading the blogs!~ Amelia

31. Posted by: Kathy

    Amelia, I work at a furniture manufacturing company in Kentucky. Summer is our slow season. In order to prevent a huge layoff this past summer, we imposed a pay cut for all salaried employees and reduced work hours for all production & non-salaried office employees in July 09, which everyone was fine with. We are waiting for orders to increase so that we may return all employee’s pay / hours to what they were before the pay cut. My question is, if we were to face this problem again next summer, would this be unlawful to do again? And is there a problem with how we handled this issue?

32. Posted by: Amelia

    Hi Kathy! Your actions sound completely lawful to us — and we think you handled the situation well.
    It is always lawful for an employer to reduce hourly employees’ hours, therefore reducing payroll. This is a very prudent way to control costs and avoid layoffs.
    It is lawful for an employer to reduce exempt employees’ salary, as long as the employees are still earning at least $455 per week, before taxes. The salary reduction is absolutely not an issue, as long as the exempt employees know about it in advance, and it lasts for at least 3 months. Ironically, it is when you reduce the exempt employees’ hours, as well as their salary, that a problem can arise. However, as explained in the article above, as long as the reduction lasts for 3 months, and affects an entire class of employees, it is lawful.
    You could do the same thing next summer and it would still be lawful. However, you might want to consider another option. There is no law that you must return employee’s wages to their previous level. Many hourly and salaried employees have had permanent reductions in wages due to economic conditions. So you could certainly give employees a slight increase, perhaps 50% of the wage reduction. This measure should mean that you won’t have to reduce salaries and wages again next summer. (Just to be safe, though, don’t make any promises. We never know what the economy will do.) HTH, and feel free to post any additional questions you might have!~ Amelia

33. Posted by: Sean

    Hi,
    I am an exempt employee. I recieve a set salary, paid twice monthly.

    I was informed last week that I need to take 1 day off a week temporarily, resulting in my salary being reduced by 1 day.

    is this legal? an exempt employee being laid off 1 day a week essentially is what is happening. I always thought exempt was paid to do a job not hours worked.

34. Posted by: Amelia

    Hi Sean! This may not be lawful.
    You are a salaried employee — but not all salaried employees are exempt. It is lawful for an employer to pay any employee on a salary basis, to make processing payroll easier. However, a salaried employee can be either exempt or non-exempt. A non-exempt salaried employee is still entitled to overtime when working more than 40 hours in the payroll week. In addition, the non-exempt salaried employee’s salary can be docked, when the employee works fewer than normal hours in the payroll week.
    Exempt employee, on the other hand, must be paid their full weekly salary if they do any work whatsoever in the payroll week, and are ready, willing and able to work the entire week.
    If you are genuinely an exempt employee, then the employer can put you on furlough one day per week, or can give you an extra day off. However, as the article above explains, you must be paid your usual weekly salary.

    The employer can permanently reduce your salary to 4/5 of the former rate. It is completely lawful to permanently reduce an exempt employee’s salary. In many cases, it is also lawful (but not necessary) to permanently reduce the exempt employee’s work week, at the same time. However, it sounds as if this change is temporary.

    The employer may be treating you as a salaried non-exempt employee (which means you would be entitled to overtime.) Or, if you are genuinely exempt, the employer is taking an unlawful action when they reduce your salary for a one-day furlough. Refer to the article above for more details. You can file a wage complaint with the US Department of Labor at http://www.dol.gov. HTH, and thanks for reading the blogs!~ Amelia

35. Posted by: Kristi

    I am an exempt salaried employee. We had been receiving Holiday Pay for the majority of the yearly Holidays. We were just told that we would not be receiving holiday pay for Veteran’s Day. or the Day after Thanksgiving. I inquired if I could use my accrued vacation days/or personal days in lieu of the Holiday Pay. I was told I could not since it would defeat the purpose of not paying any of us Holiday Pay. Our company is closed on Veteran’s Day and the Day after Thanksgiving. My salary will be reduced from 40 hours of pay to 32 hours of pay. Is this legal?

36. Posted by: Amelia

    Hi Kristi! No, this is not legal. First of all, there is no federal or state law that any US employer must observe holidays, or pay employees for holidays if the business is closed on that day. So the employer can legitimately eliminate all holidays.
    Even if the employer has an established practice or a written policy of observing certain holidays, and offering paid holidays to employees, the employer can change that policy at any time. In the case of paid holidays, the employer gives and the employer can take away. And, the employer is giving employees plenty of notice that they will not be paid for Veterans Day and the day after Thanksgiving. (Very few employers observe those days as holidays anyway.)
    However, under the federal FLSA or Fair Labor Standards Act, a salaried exempt employee who is ready, willing and able to work the entire week, and works any part of the payroll week, must be paid his or her usual salary for the week. So if you are genuinely an exempt salaried employee, and you work a portion of the payroll week, you must be paid your full salary even though the employer is closed on the holiday. Example: Suppose you work Monday, Tuesday and Wednesday of Thanksgiving week. The business is closed Thursday through Sunday. An exempt employee must be paid her full salary for the week, as long as she was ready, willing and able to work the entire week. If the employer pays you for only 32 hours, they are treating you as a non-exempt salaried employee. That would mean that among other things, you are entitled to overtime when you work more than 40 hours in the payroll week. HTH, and thanks for reading the blogs!~ Amelia

37. Posted by: Kathy

    Amelia,

    Thank you so much for your response to my previous question. Hoping you can help me with another question. I work in the HR dept for a privately owned furniture manufacturing company in the state of Kentucky. I was wondering, are we required to allow employees to view their files, if requested? If so are they entitled to more than 1 viewing of their files? And are the files of HR employees suppose to be kept separated from other employee files?

    Thanks!

38. Posted by: Amelia

    Hi Kathy! You are very welcome! We have a special website set up just for questions from HR pros like you. It’s at http://www.humanresourceblog.com. I also answer the questions on that site, so feel free to post as many questions as you like.
    But to address this question –
    A few states have laws that permit an employee to view his or her personnel file, or even have a copy of the file. Kentucky does not. These are private business records, and you are under no legal or moral obligation to share them with any employee. The best practice in HR is to give employees a copy of any written evaluation or written warning at the time. However, it is up to the employee to keep up with these documents. You are under no obligation to offer additional copies — and frankly, we suggest that you do not. (It goes without saying that you would never give an employee access to another employee’s file, or leave the employee unsupervised in a room with all the personnel files.)
    Unless the employee has a subpoena, you are not obligated to allow them access to personnel files.
    The best practice in HR is to keep personnel files in a locked drawer or file cabinet separate from other business records, but there is no law that this must be so. However, ADA and other laws require that confidential medical information be kept separate from the employee’s personnel file, in a different location where it cannot be viewed by the employee’s supervisor. In addition, the law permits you to keep copies of supporting documents for the I-9 form, but they should be in a separate file as well. HTH, and thanks for reading the blogs!~ Amelia

39. Posted by: Kathy

    Hi Amelia, I had a couple of questions I was hoping you could help me with. We have an employee who has been on worker’s comp. leave since April 2009. He has now been released to work but with permanent restrictions that we cannot accommodate. We are a furniture manufacturing company in Kentucky and there really isn’t any way for us to keep him as an employee with his restrictions. Also he has obtained an attorney, so my question is what is the best way to handle this situation?

    Also, job descriptions area and responsibilities, are these two different things? Or can we combine them should we be audited?

    Thanks so much for your help.

40. Posted by: Kathy

    Ameila,

    When it comes to slander, slamming or defaming the company to customers, other employees, relaying confidential information or misinformation especially to customers. What does that fall under and what does the company need to have or do in order to prove this?

    Also, misconduct: what are examples of this and what needs to be specifically done by employee and what proof do we need to have for proper termination and not eligible for unemployment if an employees is let go for this. Does slander falls under conduct?

    Thank you in advance!

41. Posted by: Amelia

    Hi Kathy! First of all, you need to contact your workers’ comp insurance company about this topic. They are your first advocate in this situation.

    But here is what the insurance carrier won’t tell you: We understand that you cannot accommodate this employee’s restrictions. But if he cannot return to work for you, he has a permanent disability. And having a workplace accident resulting in permanent disability will increase your workers’ comp premium, for every employee, for many years to come. So it might actually be less expensive in the long run for you to create a job suitable for this employee, rather than have him unable to return to work. For example, you might create a position as a file clerk, earning minimum wage, for this employee. Legally, you don’t have to do this — but again, it could actually save you money. (In a year or two, you could eliminate the position of file clerk without any impact on your workers’ comp insurance premium.)

    If at any time you feel that the insurance carrier is not representing the company well, then you will need to consult an attorney specializing in workers’ comp. Generally when an employee “lawyers up,” the employer needs to, also.

    As far as job description and responsibilites — we are not sure in what context this is being used. On an application? Job posting? For workers’ comp? But we will say that generally, responsibilities are more specific than a job description. The job description might be to answer client questions as a customer service rep. The responsibilities might be to answer 36 calls per hour, and provide courteous service to all callers. HTH, and thanks for reading the blogs!~ Amelia

42. Posted by: Amelia

    Hi Kathy! We would qualify slander or defaming the company or other employees as willful misconduct. That is also how we would describe relaying confidential company information or misinformation to customers. (Be aware of one limit on slander or defaming the company. In situations where employees are discussing forming a union, or organizing the labor force, much of that communication is permitted by federal law, even when it involves people outside the company.)

    If we were filling out a termination form, under reason we would put: Willful misconduct — defaming the company or Willful misconduct — relaying confidential business information to persons outside the company.

    Most employee handbooks have a “code of conduct” that specifically prohibits this type of action by employees. In many cases, under company policy, any of these actions are gross misconduct punishable by immediate termination — and justifably so. Make the language on the termination form as close as possible to the language in the employee handbook. This makes it very clear to the unemployment agency that the employee was aware that this conduct was prohibited. (If these types of actions are not covered under the employee handbook, it might be time for a new one.)

    In terms of proof, the standard for termination is much less strict than for criminal prosecution. Simply have any employee, supervisor or customer who observed this behavior write a note stating what he or she observed the employee doing, sign and date it. If the termination is based on a customer complaint, you can simply have the supervisor or coworker write a note stating, ” On November 1, 2009 customer Joe Blow complained that…”

    Kentucky is an employment-at-will state, meaning that you can terminate any employee at any time for any reason or without any reason. So you really do not need any proof to terminate the employee. However, in some cases the employee may be entitled to unemployment benefits. Generally an employee does not qualify for unemployment when the misconduct is willful — meaning a) the employee was fully aware that this was against company policy and b) the employee had control over the behavior. If the employee has signed the employee handbook, that should satisfy requirement a). All of the situations you mentioned are conduct that the employee has control over. (Will we say that state unemployment agencies are not 100% predictable, and sometimes act in illogical ways. But you are much, much better off without this employee.)

    In the future, if you fire an employee for matters of company policy that are not covered in the employee handbook, you may want to have 3 written warnings before you terminate the employee. This demonstrates that the employee was fully aware of the company policy (for example, about tardiness or meal breaks) and that you gave the employee every chance to comply. But frankly, in the case of disclosing confidential information or passing misinformation to customers, we would not wait that long to terminate the employee.

43. Posted by: karen

    My company just laid off around 15 people last week & we have around 30 employees left. The president of the company told my supervisor couple days ago that me & my supervisor will both get a 20% pay cut but everyone else in the company still make the same money. I am the only Asian in the company, I am 4 mths pregnant, I feel totally discriminated because of my sex & being pregnant. What should I do? I live in Missouri, if I quit, can I get unemployment? Also am I eligible for COBRA/ARRA the 35% subsidy for my health insurance (since health insurance is very important to me because I am pregnant)? Please help, thank you!!!!

44. Posted by: Amelia

    Hi karen! If the employer is reducing your salary because you are Asian or pregnant or both, that would be illegal discrimination. However, if there is a valid business reason for the two of you to be selected, that is not illegal discrimination. For example, if the two of you were the only ones in your department or are the highest-paid employees, those would be valid business reasons.
    In many cases, an employee who quits rather than accept a 20% pay cut is eligible for unemployment. However, if you work under the new salary for even one day, you have accepted it. You will be eligible for COBRA if you quit. However, you will not be eligible for the COBRA/ARRA subsidy, so you will have to pay 100% of the premium, rather than 35%.
    One possible solution: let the president of the company know that you think this is discrimination, but if he decided to lay you off, you would not file a complaint. If you are laid off, you will qualify for unemployment and the COBRA subsidy.
    Another option would be to remain with the company, but file a discrimination complaint with the EEOC at http://www.eeoc.gov. HTH, and thanks for reading the blogs!~ Amelia

45. Posted by: holly

    Hi there,
    I am a salaried exempt employee (actually the only one at my job, everyone else is hourly). We do not receive benefits, no vacation, no sick time, no paid holidays. Last week I was sick with the flu. Prior to finding out my condition I worked 1 full day and 2 partial days, then was told by my owner to stay home and rest and come back on Monday. I did so not thinking any different, then when pay checks came in mine was short. He docked me 24 hrs without notice! Am I entitled to pay for the week or is he in the right?

    Thanks in advance,

46. Posted by: Amelia

    Hi holly! A salaried employee can be either exempt or non-exempt. It appears that the employer is treating you as a non-exempt employee, which would make you eligible for overtime if you work more than 40 hours in the work week. A non-exempt employee’s salary can be prorated when the employee works fewer than 40 hours in the payroll week.

    Assuming that you were genuinely an exempt employee, you would be entitled to the full week’s salary when you were sick, under federal law. An exempt employee who works any part of the day is entitled to the full day’s salary. When an employer offers no paid sick leave, the exempt employee must be paid his or her usual salary for the payroll week, during any week in which the employee misses one or more days due to illness. (The rules would be different if your employer offered paid sick leave under some circumstances. Ironically, when the employer offers a bona fide paid sick leave plan or policy, and an exempt employee exceeds it, the employee need not be paid if they are absent from work the entire day. Different rules would also apply if you were absent for a reason other than illness.)

    Since you are being treated as a non-exempt employee, you could file a wage claim with the US Department of Labor at http://www.dol.gov for any overtime worked in the past 2-3 years. Or, you could file a wage claim for your full week’s salary, as an exempt employee. HTH, and thanks for reading the blogs!~ Amelia

    Read more about this at: http://www.dol.gov/whd/regs/compliance/fairpay/fs17g_salary.htm

47. Posted by: Kathy

    Hi Amelia,

    When it comes to employee files, what items do not need to be included in an employee file? Our company requires all employees to have a drug test done when they are hired, can these results be kept in the employee file or would this be considered a medical record and should be kept separate? Also when it comes to the I-9 form we have several employees who are from other countries, normally we make a copy of 2 forms of identification, usually their social security card and picture ID (driver’s license, work authorization card, or residents card etc). If they have a driver’s license do we need a copy of their work authorization or residents card also? Does the work authorization card overrule the I-9 form? We use “E-verify” to verify this information after they are hired. I’m just trying to make sure our files are correct for an upcoming audit. Thanks so much for your help.

    (We are a manufacturing company in Kentucky)

48. Posted by: Amelia

    Hi Kathy! The drug test should probably be considered medical information, and kept in the employee’s confidential file.

    Legally, you are permitted to make copies of the supporting documents for the I-9 form. However, if you keep copies, you must keep copies for every newly hired employee — not just those who were born in another country (and not just those who are Hispanic.) Selectively copying I-9 documents is illegal discrimination based on national origin. If you keep copies of the I-9 supporting documents, they should not be in the employee’s personnel file or confidential file. All the I-9s should be in a file or notebook together, preferably alphabetized.

    An employee can have a driver’s license and still not be able to work legally in the US. The driver’s license permits the employee to drive. A birth certificate, social security card or work authorization document proves that the employee can legally work in the US. So the answer to the question, “If we have a copy of their driver’s license do we need a copy of their work authorization card also?” is most emphatically “YES!!”

    Nothing overrules the I-9 form. The I-9 contains a very clear list of the documents that an employee can present to a) establish identity and b) establish authorization to work or c) both. Under no circumstances should you vary from this list, or allow anyone who has not presented these documents to work. By doing so, you are in violation of federal immigration laws, and very likely employing undocumented workers. (Even if the employee passes E-Verify, you need to keep the I-9 form on hand indicating that the employee has presented the required documents.) This is a complex topic, so feel free to ask any additional questions you might have. HTH, and thanks for reading the blogs!

49. Posted by: Kathy

    Amelia,

    Thank you. We do keep supporting documents for every new hire (regardless of race), I was just wanting to be clear on the supporting documents for employees who are not citizens of the US. All new hires also do complete the I-9s. Regarding the driver’s license, if we have a social security card and a document that proves that the employee can work in the U.S, do we need the driver’s license? (I didn’t word my question right in my previous blog).There was an attorney in Kentucky which told us that a copy of a Kentucky ID/driver’s license would also need to kept. I have never heard of this before.

50. Posted by: Kathy

    Amelia,

    Another questions, does a copy of the employee’s social security card also need to be kept in the employee’s file (a copy is kept with the I-9 along with the another supporting document)?

51. Posted by: Amelia

    Hi Kathy! You do not necessarily need a driver’s license or state ID card on every employee.

    Here’s the I-9 form in its entirety: http://www.uscis.gov/files/form/i-9.pdf . Many employers make copies of only parts of the form, which becomes a problem. An employee who presents a valid, unexpired document from column A does not need to present anything else. In fact, requiring that they present anything else may be illegal discrimination. For example, a US citizen can present a passport instead of a driver’s license and social security card. No further documentation is required for the I-9 form. As an employer, it is illegal for you to specify which identity documents the employee will present. They are free to choose from among any of the acceptable documents. You cannot discriminate against an employee who chooses one document over another.

    But wait, it gets a little more complicated. Because you use E-Verify, you can require that employees show the I-9 document(s) plus a social security card. E-Verify uses social security cards to verify the employee’s eligibility to work. The legislation covering E-Verify specifically grants employers that right. However, that does not give you the legal right to dictate which other I-9 documents the employee may use. An employee who chooses to do so can present a US passport, or a permanent resident card, plus a social security card. If this employee refused to supply a driver’s license or state ID card, and you refused to allow him or her to work, that would be illegal discrimination.

    The attorney probably gave you that advice because he is concerned that you need to establish the identity of the person you are hiring. That is a valid concern. (Undocumented workers very commonly pretend to be someone else, and present that person’s documents — including a driver’s license and social security card.) However, the I-9 permits employees to use any of the documents in column A or column B to establish identity — including a passport, resident alien card, draft card, military ID, etc. Most of these documents (for employees over 18) have a photo on them. Naturally, you should examine the photo carefully to ensure that they are the same person you are hiring.

    It is not appropriate to require that employees or applicants present a driver’s license unless driving is part of their job duties. It is not appropriate to require that employees present a state ID card when they have presented another I-9 identity document. HTH, and thanks for reading the blogs!~ Amelia

    Our favorite souce of I-9 forms is: http://www.laborlawcenter.com

52. Posted by: Amelia

    Hi Kathy! The best practice is to keep the copy of the social security card only in the I-9 files. However, since the social security card does not show the employee’s age, race or color, or citizenship status, there is no risk of illegal discrimination when it is kept in the personnel file as well. HTH, and thanks for reading the blogs!~ Amelia

53. Posted by: Jamie

    Can an employer reduce your salary for not being at work for 3 days one week due to a funeral? A month after the fact? My employer took 3 days out of my paycheck for a funeral 1 month ago. I got paid my normal rate last pay period and minus 3 days this pay period.

54. Posted by: Kathy

    Amelia,

    Another question about what should be in an employee file. All of our employees get an employee badge, with their picture and employee number on it, can this same picture be kept in the employee’s personnel file? Also can paperwork showing employee’s pay rate, dates of applicable pay changes,work positions changes, direct deposit information, requests for employment/payroll verification and court documents (such as, domestic violence issues) be kept in the personnel file? What about employee documentation on complaints? I’ve keep getting different information on what should and should be in the folders from other sites.

55. Posted by: Kathy

    This is what is stated in out employee handbook regarding Holiday pay:

    “For an employee to receive holiday pay, that employee must work the regularly scheduled full workdays immediately before and after the holiday. If an employee misses any of his/her scheduled work shift the day before or the day after a paid holiday due to an emergency or employee illness, the direct supervisor and administration must approve absence to receive holiday pay.”

    My question is, if an employee was scheduled to work on the actual holiday, such as Thanksgiving day, but on that day the employee did not show up nor did they call in, would we still be required to pay them holiday pay? Also if an employee used a vacation day for the day before or after the holiday, would they still receive holiday pay? Thanks!

56. Posted by: Amelia

    Hi Kathy! Most of these issues relate to the best practices in HR, rather than to employment law.
    As a general rule, you do not want any information in the personnel file that the supervisor would not consider in making an employment decision such as promotion, demotion, training, discipline, etc.

    It is not generally a good idea to keep the employee’s photo in the personnel file. This is because it is illegal to consider an employee’s race or color in any employment decision. Unfortunately, in the past some employers have used photos for this purpose. The simple way to conform to the law is to keep anything that would show the employee’s race or color out of the personnel file. If you must keep copies of these photos, keep them in the confidential file.

    It is completely appropriate to keep work history and salary information such as pay rate, pay changes, positions, direct deposit, employment/payroll verification information in the employee’s personnel folder. After all, the employee’s work history, references and salary history are important factors that any supervisor should consider in making employment decisions. (Many employers would keep credit checks or pre-employment background checks in the confidential folder. Once the employee is hired, they are no longer relevant. )

    It is not appropriate for court documents such as those regarding the fact that an employee is the victim of domestic abuse to be in the personnel folder. That belongs in the confidential folder. Any employee can be a victim of violence or abuse — it doesn’t tell you anything about that person’s work performance or potential work performance. (Some states prohibit employment discrimination based on being the victim of a crime or of domestic abuse.)

    If the employee has an order of protection against him or her, that is a different issue. Some employers would keep that info in the confidential file. Others might see it as evidence that the employee is potentially violent, and keep it in the personnel file. Either decision could be defended in court in most states. But the safest decision would be to keep that information in the confidential file.

    Any information regarding convictions, especially for violent crimes, can be kept in the personnel file in Kentucky and most states.

    It is appropriate to keep work-related documentation regarding complaints and investigations in the personnel file. Just be aware that you cannot retaliate against an employee for filing a complaint of discrimination or a wage complaint, even if that complaint is later found to be false. This is a complex topic. If you have additional specific questions, feel free to ask. HTH, and thanks for reading the blogs!~ Amelia

57. Posted by: Amelia

    Hi again Kathy! The important point to remember is that employee handbooks are basic guides to company policy — but they are not the entirety of company policy. It would be neither possible nor desirable to have every policy in writing, in excruciating detail. Some employees like to play “gotcha” by proclaiming that the employer cannot enforce a policy if it cannot be found in the employee handbook. They are mistaken. Those employees are ignorant of the basic facts: that the employer, not the employee, makes up the rules in the workplace. (If there is a union contract in place, that further constrains the employer’s policies.)

    In this case, nothing in the handbook addresses the specific situation of an employee who is absent on the holiday. So as an employer, you have leeway to create an appropriate (unwritten) policy. First, you should deal with this employee as you would any other who was no call/no show on a scheduled work day. In many companies, that means suspension or termination.

    There is nothing in your written policy that would require you to grant holiday pay to the employee who was a no-show on Thanksgiving . The handbook policy only addresses what happens when an employee is scheduled to be off on the holiday. There is almost no company in the world that would give the employee holiday pay under these circumstances.

    There is a different situation if the supervisor approved a day of vacation in advance, and that vacation day fell on the day before or after the holiday. In that case, the direct supervisor and administration approved the absence, and presumably the employee is entitled to holiday pay. (If the employer could not approve that, the employee should have been told in advance “We can approve your vacation day for Wednesday Nov. 25, but you will not be paid for the Thanksgiving holiday if we do.”)

    However, if this is the same employee, having an approved vacation day on Wednesday does not excuse being no call/no show on Thursday and once again the employee is not entitled to holiday pay.

    If the employee took an impromptu, unscheduled day off before or after the holiday, that is a different issue. Most employers do not permit employees to use vacation time in this way, and would not pay an employee who did so holiday pay. In effect, that absence has not been approved by the direct supervisor and administration. HTH, and thanks for reading the blogs!~ Amelia

58. Posted by: Amelia

    Hi Jamie! Yes, this is legal in almost every state except California. An exempt employee need not be paid when he or she takes one or more full days off work for personal business — and a funeral is personal business. So you were overpaid by 3 days during that payroll week. Virtually every state except California permits an employer to make a deduction during a later payroll cycle, when the employee is accidentally overpaid. That is what the employer did. HTH, and thanks for reading the blogs!~ Amelia

59. Posted by: Kathy

    Amelia, regarding the employee picture in the personnel file. We keep a photo in the file specify for identification purposes because we are a very diverse company of over 400 employees. Also in past years, when we’d receive notice from the social security administration that it was possible that one of our employees was using false documentation, they would ask us to send a photo in along with other information. Would the photo in the file this still be a problem, if it were just for identification purposes ?

60. Posted by: Amelia

    Hi Kathy! Yes, the photo is still a problem, even if your intention is not discriminatory. For one thing, how will you prove what your intention was, if you are sued for discrimination? For another, it can have a discriminatory effect, even if that was not the intention. When companies keep info on an employee’s race or color, fewer minority employees tend to get promoted.

    Here is how a slick lawyer would put it in court: A manager has two personnel files on his desk — one of a Caucasian employee, one of an African American employee. He doesn’t know either employee, but has to decide which one gets promoted. They both have very similar qualifications. The files have photos in them, and the Caucasian employee gets the promotion. The slick lawyer will claim that this is obviously discrimination — that your intention in keeping photos in the file was to allow managers to distinguish between employees based on race and color. How are you going to show that race or color did not play a part in that promotion decision? The best way would be to show that the manager did not have information on race or color available in the personnel file.

    The E-Verify situation is a separate issue. Oftentimes, when identity theft is suspected, the DHS or social security will request a photo of the employee. You can certainly use the employee’s ID badge photo for this. However, like other E-Verify documents, it is not appropriate to keep this in the personnel file. If this is your purpose in keeping the photos on file, then they should be kept with other I-9 documents. Otherwise, we recommend that they are kept in the confidential file. (In fact, one of the reasons that I-9 documents are kept separate is because they contain photos, and present a risk of illegal discrimination based on race, color, etc. or the appearance of such discrimination.)

    You can certainly keep photos of employees in their personnel files if you like. It will just make it very hard for your company to defend against any discrimination suit in the future. HTH, and thanks for reading the blogs!~ Amelia

61. Posted by: Kathy

    Hello again!

    When we verify employment for a previous employee, what information can we release? At the moment, we just release that dates that a person was employed with us. Is this all that we are obligated to tell a future employer? What about when it comes to violent employees?

    Also in addition to manufacturing furniture, we have a trucking division, when we are attempting to verifying previous work references for a trucker, what are we legally allowed to ask? Are we allowed to ask about that person’s previous pay amount, if they would be rehired, their general conduct and character?

    Kathy

62. Posted by: Amelia

    Hi Kathy! This is a delicate balance that every employer negotiates. You are not legally obligated to tell prospective employers anything. And of course, you want to get as much information about a prospective employee as you possibly can, which means that these two ideas are in opposition to each other.

    Unfortunately, there can be legal repercussions if you give out negative information that prevents a former employee from getting a job. (Some employers have been sued for millions of dollars and won, even when the information they gave was accurate. For this reason, you may want to consult an attorney before setting a policy on giving references.)

    Some employers have no problem giving out tons of positive information on a good employee. So the very fact that the former employer is giving limited information, may tell you something. (Some larger companies will never provide more than a neutral reference, verifying dates of employment, salary and possibly reason for leaving.)

    Most employers will verify the dates the employee worked, and the salary the employee earned. (Verify meaning the caller says, “The employee tells us he earned $12.75 per hour, is that correct?” or “We show that he worked for your company from December 2006 to March 2009, is that correct?” and you answer “yes” or “no” with no futher details.) Many employers will answer the question, “Is the employee considered rehirable?” with a simple yes or no. A “no” to any of these questions would be a strong clue that the employ has not been honest, and should not be hired.

    Some former employers will answer the question, “If you were in my situation, would you hire this person as a truck driver?”

    When you are on the other side of this equation, you can ask the previous employer almost anything — but they are under no obligation to answer. (Obviously you would avoid questions like “What religion is this employee?” and “Does she plan on having more children?”) Usually it is easier to start with the simple yes/no questions, and gradually ask for more information. “Did the employee have any problems with tardiness or absenteeism?” and “The employee says he voluntarily resigned, is that correct?” should probably come before “What performance problems did the employee have?” In practical terms, once the former employer refuses to answer a question, they will probably refuse to answer all subsequent questions.

    You should certainly ask if the employee ever showed any violent tendencies. Again, there is a delicate balance here. Some employers will reply,”On the advice of our attorney, I cannot answer that question.” This means “Yes, but I’m not supposed to say so.” In that case, you would not hire the employee. Most employers would feel comfortable replying,”No, the employee never showed any violent tendencies” if that is true.

    By all means, ask about the employee’s previous salary history, rehire status, conduct and character — sometimes you will run into a newbie who will answer all of your questions in great detail. But put the most crucial questions first, so you get the basic information you need before the reference clams up.

    A few final words of caution. Sometimes the employee’s immediate supervisor is more forthcoming than the HR department. And, beware of any employee who provides only family members or friends for references. He probably robbed a bank at his last job. The same is true in spades for any employee who gives a minister, priest or rabbi as a reference. Usually clergy make it a practice not to say anything bad about anyone, rather than giving accurate information. HTH, and feel free to post any more questions!~ Amelia

63. Posted by: Kathy

    Amelia,

    If we hire someone and they give us a social security card and an ID from another state (we are in KY), are we required to have a KY ID on file?

64. Posted by: Amelia

    Hi Kathy! No, you are not required to have an ID from your own state on file. The purpose of the driver’s license or state ID for the I-9 is to prove identity (the social security card shows that they are legal to work.) As long as the state ID is unexpired, and appears genuine, it can be from any state. Again, the employer cannot legally dictate which I-9 documents an employee may use. The employee is free to choose between any of the acceptable documents listed on the I-9. Obviously, if you are hiring a truck driver in Kentucky, you will want him or her to have a valid Kentucky liscense. HTH, and thanks for reading the blogs!~ Amelia

65. Posted by: kristi

    I am a salried full time exempt employee in Oregon. My employer has me working 8hr days without any breaks….10 min. or 30min lunch. I am scheduled to work from 8:30-4:30. I work in a licensed chidcare where I am required to be in ratio during our winter break camp. They have not scheduled any additional staff to cover for a break. I know that if an hourly employee is unable to be relieved from all work duty for a lunch, they can have a “working lunch” and must be paid for that. My question is what about a salried exempt employee that is unable to take any breaks?

66. Posted by: Amelia

    Hi kristi! The Oregon meal break law applies to most but not all employees. 1) Some employers such as state and local government agencies are exempt, usually including schools. 2) The Oregon meal break law does not appear to cover exempt Executive, Professional or Adminitrative employees. 3) There is also a provision under the law that the employer need not give meal breaks to employees if it would pose an undue hardship on the operation of the employer’s business. If appears that 2 & 3 apply in your situation — it is probably not economically feasible for the employer to schedule an additional employee so that you can take a lunch break.
    There is nothing in the regulations that would prevent an exempt employee from eating while she was on duty (perhaps a sandwich?) but there is also no legal requirement that the employer must allow it.

    However, as far as we can tell, exempt employees are covered under the Oregon rest break law. This would mean that you are entitled to a 10-minute paid rest break for each 4-hour work segment. For more info, contact the Oregon Bureau of Labor and Industry. HTH, and thanks for reading the blogs!~ Amelia

67. Posted by: KR

    HI Amelia,

    I am an exempt salaried employee at a non-profit trade association in California. I suspect I am improperly classified because of my title. The “products” we offer are education and networking events. I produce those events. My title is Event & Education Manager but I do not supervise any employees. What are your thoughts?

68. Posted by: Amelia

    Hi KR! Under the federal FLSA, the Fair Labor Standards Act, there are 5 categories of exempt employees, depending upon the employee’s primary duties. Only one of those categories requires supervison of employees. We suspect that you are an exempt Administrator. Check the info below, and if you still believe you are improperly paid, consult the US Department of Labor at http://www.dol.gov. HTH, and thanks for reading the blogs!~ Amelia
    Read more about this at: http://www.dol.gov/whd/regs/compliance/fairpay/fs17a_overview.pdf

69. Posted by: KR

    Hi again,

    So in your opinion, would the Administrative Exemption fit for me even though I am directly invovled in producing what we sell here (networking events and education?) Also, what are the rules as far as disciplining an exempt employee for tardiness?

70. Posted by: Amelia

    Hi KR! We can’t really make a determination on your exempt/non-exempt status without knowing a lot more about your job. Normally employees who produce a product are non-exempt, but in this sense, “produce a product” would mean a manufacturing employee who works on the line in a factory producing a tangible product…not an employee who teaches or organizes training events. (In HR terms, networking events and education are not a product…they are a service.) We think it is very likely that after looking at your primary job duties, the determination would be that you are an exempt Administrator.

    An exempt employee can be disciplined for tardiness. Employers have the right to establish minimum work standards for exempt employees, including the business hours they will be present, and the minimum number of hours worked per week. If an exempt employee works any part of the day, he or she is entitled to payment for the entire day. However, the employer can be disciplined or terminated for not working the expected hours.

    Suppose Rene is an exempt employee whose employer expects her to work from 8 am to 5 pm each week day. If Rene comes in at 8:10 one day or leaves work at 4:50, the employer must pay Rene her entire daily salary. However, Rene can be disciplined or fired for not meeting the employer’s minimum performance standards. HTH, and thanks for reading the blogs!~ Amelia

71. Posted by: KR

    Last question 9promise I read in California that in Bell v. Farmers Insurance the court held that claims representatives for an insurance
    company were not administrative employees.In reaching its decision, the court considered the distinction between “administrative” employees and “production” employees. Because Farmers Insurance Exchange’s primary business was handling insurance claims, and the claims representatives spent the majority of their time at work handling claims, the court determined they were production employees and therefore
    not covered by the administrative exemption, even though the work the employees performed was non-manual, office work that involved
    some discretion and exercise of independent judgment.

    My primary job function is to plan and implement our education offerings and networking activities. This happens to be our main revenue generator as well.

    Are your thoughts still the same? I understand you are not providing legal advise, I am just trying to gather information. I appreciate your help.

72. Posted by: KR

    I just found that the ruling was overturned due to the independent descretion portion.

    Thank you

73. Posted by: Amelia

    Hi KR! Ahhh. Just a word of advice. If you are working in California, you need to always mention it when asking an HR question. The California laws are much, much stricter than the laws in any other state, and generally what works in other states does not work in California. Our previous answer addressed the issue of exempt status under federal law. Yes, California has stricter guidelines than other states for exempt employees. Again, we would not be surprised if you are an exempt employee, even under the California laws. This would especially be true if you have any flexibility in pricing the products that are sold to customers, or make other business decisions.

    Also beware of basing your judgment on a single court case unless you are a lawyer or a paralegal. Often there are extenuating circumstances that are unique to that case, that don’t apply in your situation. Again, you can certainly file an overtime complaint with the California DLSE. They will investigate and determine whether you are an exempt employee under California law or not. HTH, and thanks for reading the blogs!~ Amelia

74. Posted by: Faith B.

    Hi! I wanted to know what are my legal rights in this situation:
    I’m a nurse and I was wrongfully terminated by my Director who happen to not like anyone including me! She took my 2 week notice to change from days to nights and explained to me that she was going to honor that as my 2 week notice because she doesn’t think I was a right fit for the job! Never mind the fact that just 3 months prior she just gave me an A+ on my total evaluation and gave me a nive raise. I spoke my opinion concerning an issue we had and she didn’t like that and 2 weeks later I’m out the door. I obtained my total employee file and it states I’m non- rehireable. But according to her statements in my unemployment file “I quit voluntarily”! So what do I do about applying for other jobs?? What do I do that she lied?? I’m in Michigan and were “At Will”. The handbook that I signed clearly states that it does not indicate a contract between us… what do I do? what are my rights? She’s such a mean and nasty person I can see her doing the non rehirable thing after I had a letter wrritten by an attorney to obtain my records in a timely manner. What do I do??

75. Posted by: Amelia

    Hi Faith! Sorry, but we may not be able to help you much. It seems that the employer perceived you as a difficult, demanding employee. Demanding the day shift and hiring an attorney to get a copy of your employment file support that view. Naturally any employer would make such a person non-rehirable.

    (We have to ask: what, exactly, did you gain by getting a copy of your personnel file? Other than making the employer angry and making yourself nonrehirable?)

    We have no doubt that this director was hard to get along with. But other employees somehow managed, and remain employed. If you gave the employer notice that after 2 weeks you would no longer be working the night shift, you did quit. Employees usually aren’t allowed to dictate the hours that they will work. In most states, this situation does not meet the legal test for wrongful termination. (If you still disagree, you can certainly hire an attorney to sue the employer for wrongful termination. But we doubt that you will win.)

    There is no employment law that deals with the issue of being rehirable or non-rehirable. This is entirely up to the employer’s discretion. The question is simply, “If you had it to do all over again, would you hire this employee today?” Your employer is answering “no”, and they have every right to do so.

    You are caught between a rock and a hard place because it is never a good idea for a job applicant to bad-mouth her previous employer. Even in the most innocent situation, it makes the employee look like she is hard to get along with. If the issue comes up in the interview, you need to say that you left over a misunderstanding, or it was simply time to move on.

    Your best bet is to try to find someone else at that organization who will give you a positive reference. If that doesn’t work, then try giving the HR department as a reference — often they will only give a neutral reference, and that is the best you are going to get from this employer. (Have a friend call to check your references, just to be sure.) Otherwise, your best bet is to rely on past jobs for good references, or to go to work for a temporary service that will give you a positive reference after a few months. The good news is that nurses are in high demand, so it may take a year but you should be able to find another job. In many industries, this type of behavior would have been the kiss of death. HTH, and thanks for reading the blogs!~ Amelia

76. Posted by: Faith B.

    Thanks Amelia, maybe I should have taken more time to explain my situation. I was instructed to write the 2 week notice to change shifts, per HR because that’s the policy. I actually bid on a job, got it, my Director signed and agreeded to my shift change. It was after I had already worked my six “12″ hour shifts, to complete my notice that she inturned called me while at home on my day off and told me that. I also asked for my employee file nicely, after waiting almost 4 weeks, I did obtain legal assistance. I only wanted to know why I was fired. The unemployment investigation even was in my favor because I wasn’t the one who initiated the seperation. I just don’t understand how someone can fire you and then lie to unemployment to say I quit so they don’t have to pay, and then label me non- rehirable as if I’m a bad person. I have never been in any disciplinary positions, I’ve never been fired from anywhere. I’ve been a nurse for 10 years! I’ve never had any warnings or “talking to’s” up until the one incident where I was suppose to allow my director to be disrepectful and down right unprofessional by telling me that ” I need to teach my husband to do more” after learning that I spent my UNPAID lunch doing homework in the lobby with my son. To me that was a personal “jab”. How I spend my personal time isn’t her business. So I did say to her. ” I actually like spending time with my children.” I don’t see them for days at a time when I work as much as I do so it’s OK with me if they have to drive 20 minutes to see me for 20 minutes. She just gave me “The look”. She stop speaking to me, and two weeks later I was fired on my day off. Basically she’s a big bully and threatens to fire people on the spot daily. She creates a hostile environment on purpose. The turn over is horrible. I just figured if I stay outta her way I’ll keep my job, well I suppose that day I was in her way. How can she get away with that?

77. Posted by: Amelia

    Hi Faith! Thanks for explaining — that makes much more sense. You don’t mention which state you are in, but most states have the “employment at will” doctrine, which means that any employer can fire any worker at any time for any reason, or for no reason at all, with or without notice. So that’s how you could be terminated.

    We agree that after you got into a verbal disagreement with the supervisor, she took the first available opportunity to terminate you. While her personal attacks were unjustified, we have to say that most employers would not permit children to visit on work premises during the parent’s break. It is the employer’s prerogative to set such policies. So while her attacks were personal, she had a point. (We will also say that even when a supervisor launches unprovoked personal attacks, two wrongs don’t make a right. Attacking back is usually not the best policy. In this case, if you had acted in a more mature way than she did, it is possible you would still have a job. You won the battle, but she won the war.)

    It sounds like this director is immature and vindictive, but you will encounter many poor managers in your career. Learning to handle them is a basic job skill.

    It is good that you won unemployment benefits on appeal, but it does not prove that you were right in this situation, and it is not likely to impress potential employers with your innocence. Even bringing it up makes you look as if you are hard to get along with.

    Just so you will know, in most states you do not have any legal right to your personnel folder — they are business records belonging to the employer. And frankly, you have little to gain by demanding a copy of them. This case is a good example. You are actually worse off with the personnel file than without it, because you are now non-rehirable — and that information is likely to be shared with interviewers.

    Unfortunately, there is nothing unlawful about threatening to fire people, and this does not meet the legal definition of a hostile work environment. Any time an employee is at odds with her supervisor, she is likely to be terminated. HTH, and thanks for reading the blogs!~Amelia

78. Posted by: Kathy

    Hello again Amelia,

    We have an employee who was incarcerated on the January 1st, 2010 for a violent assault against another person and has not been to work since nor do know how long he will be incarcerated. This is employee has accrued 50 hours in vacation time and 25 hours in personal time for 2010, but has not been an active employee in 2010. My question is, are we legally obligated to pay out his accrued vacation & personal time if he is to be terminated.

    Thanx!

79. Posted by: Amelia

    Hi Kathy! You may be surprised to learn that you can terminate this employee for absenteeism, but not for the arrest. This is because theoretically the employee is innocent until proven guilty. (After his conviction, you could terminate him.) While we understand that this employee is probably guilty, remember that innocent people are arrested and “incarcerated” every day. As an employer, you cannot assume that arrest is the same as guilt.

    Vacation pay in Kentucky is a matter of company policy, not employment law. As you may know, Kentucky labor laws do not require that the employer pay workers for unused vacation at termination. So you should follow your usual company policy on this matter. Since this exact situation has not come up before, you could certainly implement a company policy that an employee must work at least one day during the current year to be eligible for vacation pay at termination.

    If your employees are covered by a union, then obviously the union contract takes precedence. HTH, and thanks for reading the blogs!~ Amelia

    Read more about this at: http://www.labor.ky.gov/ows/employmentstandards/faq.htm

80. Posted by: Kathy

    Amelia,

    Would we be required to pay out any unused vacation for an employee who is being laid off?

    Thanks!

81. Posted by: Amelia

    Hi Kathy! You are not necessarily required to pay a laid off employee for unused vacation in Kentucky. There are two issues here — state law and the employer’s policy or past practice. Kentucky state law does not require that an employer pay workers for unused vacation at termination. (Several other states including Illinois, California and Louisiana do.)

    However, in Kentucky as elsewhere, if the employer has a written or unwritten policy of paying vacation at termination, or has a past practice of paying for unused vacation at termination, then the employer must follow that policy until it is formally changed. The issue here is illegal discrimination.

    Suppose you have always paid employees for unused vacation at termination. If you terminate Josie today and refuse to pay her for unused vacation, she can file a lawsuit claiming illegal discrimination based on race, color, age, sex, etc. and will probably win. To avoid this, you would need to pay Josie for her vacation and then issue a new written policy that employees will not be paid for vacation at termination. (Some employers pay workers who are laid off or quit, but not those who are fired for misconduct. Some paid employees who give two weeks’ notice, but not those who quit with less notice. All these policies are lawful in Kentucky as long as they are in writing and applied to every employee.)

    Note that even in states that require payment for unused vacation, the employee is entitled only to the vacation that they could have used on the last day of work. HTH, and thanks for reading the blogs!~ Amelia

    Read more at: http://www.labor.ky.gov/ows/employmentstandards/faq.htm

82. Posted by: Kristi

    I live in Oregon and our next scheduled payday will arrive on a Sunday. Can my employer wait till Monday to give us our paychecks or are they required to pay us on Friday?

83. Posted by: Amelia

    Hi Kristi! No, this is probably not legal in Oregon. Under the state wage payment law, the employer can establish any payday they like, but must pay workers on payday. In this case, employees could be paid on Sunday, or they could be paid before Sunday. But the employer cannot lawfully withhold wages until Monday. We will add that with computers and FedEx, there is no reason for an employer to be unable to meet payroll. Usually when the employer tries to delay payday, it is due to cash flow problems with the business.
    We suggest that you immediately call the Oregon Bureau of Labor and Industry. One quick call from their representative will probably change the employer’s mind about paying workers on time. If you are not paid on Sunday, you should file a wage complaint with the BOLI. That will discourage the employer from doing this again. HTH, and thanks for reading the blogs!~ Amelia

    Read more about this at: http://www.boli.state.or.us/BOLI/TA/T_FAQ_Tafinpay.shtml

84. Posted by: Andy

    Here’s a twist:
    President of my company (in PA) announced a 10% reduction in salary with no change in hours for every individual (exempt and non-exempt) below the senior management levels, which were cut even more. The cut is to be imposed for a period of 3-4 months (with fuzzy description of exactly when/why salary would be reinstated). At the end of the year the total amount withheld is to be issued as a lump sum (with terms like “should” and “if” tossed in with regard to the sales forecast).

    Not nearly as draconian as some of these other posts, but is it legal?

85. Posted by: Amelia

    Hi Andy! Yes, this is a legal reduction to salary for exempt and non-exempt employees. An employer can reduce an employee’s salary at any time, as long as the employee is informed before the work is performed. As long as the salary is still above $455 per week, the employee can be exempt.

    Ironically, salary reductions for exempt employees are more of an issue when they are accompanied by a reduction in the number of hours worked. When the salary is reduced but the hours remain the same, there is really no issue unless the new salary is below $455 per week.

    The employer is right to qualify their intention of paying a year-end bonus for 2010 equal to the lost wages. There is no legal requirement that the employer must do so. They are showing good intentions by making this suggestion, but employees should not rely on it. From a financial perspective, employees need to adjust to the fact that they are now earning 10% less, and that reduction may be permanent. HTH, and thanks for reading the blogs!~ Amelia

86. Posted by: Kathy

    Hi Amelia,

    We have a situation that I would like your help on. Our company has a shutdown week at the end of the December where production employees do not work. During this shutdown week there was a very violent confrontation between several people (2 of which are company employees) that happened off of company property. This situation lead to one of our employees being incarcerated, and the other employee being hospitalized. These two employees work in the same department, within eye view of each other. The employee who was assaulted has been released from the hospital but has a doctor’s statement which does not allow him to return to work. This situation is currently under police investigation and the assaulted employee has obtained legal council. The other employee who was involved in the assault has been released from incarceration but is charged with a 2nd degree felony assault and is to come before the grand jury shortly. His last hire date was in 2006 and has had some problems in his work history. We feel that this employee is a threat to the safety of not only the assaulted employee but also to others. We feel that he is a risk to have on company property. The assaulted employee has worked here since 1999 with a good work history. We are not sure how to handle this situation.

    Thanks for your help!

87. Posted by: Amelia

    Hi Kathy! You are right to be concerned about this situation. This is the type of scenario that can easily erupt in fatal workplace violence, and not just for the employees involved — for innocent bystanders as well. While there are two sides to every story, it sounds like there is clear evidence on who is the aggressor in this case. Obviously, you do not want violent employees in the workplace.

    The employee who was assualted was in the hospital. That means by definition he has a serious health condition and is eligible for FMLA, unpaid leave under the federal Family and Medical Leave Act. You should immediately issue FMLA papers to this employee and inform him that his time off is covered by FMLA. This protects you from a discrimination complaint by the aggressive employee when he is terminated.

    If the aggressive employee missed work due to incarceration, those were unexcused absences. He is not elibigle for FMLA — incarceration is not covered by that law. You can terminate the employee due to unexcused absences.

    If the agressive employee did not miss any scheduled work days due to the shut-down, that is a more complex problem. There are several possible responses, but we suggest that you terminate him as soon as possible, before the victim returns to work. As an employer, you can assert your right under “employment at will” and terminate this employee without giving any reason for the termination to him or to the unemployment agency. The employee will qualify for unemployment benefits, but that is the least of your worries at this point. It is much more important to keep all of your employees safe.

    An employee can also be terminated for making threats against or committing a violent act against another worker, at work or away from work. This is not subject to the same tests as a court case. If the victim says, “Joe Blow threatened me and hit me” and you believe him, you can terminate “Joe Blow.” However, be aware that if there are credible witnesses that both employees threatened each other, that can leave you in a precarious legal position. So we recommend an “at will” termination.

    As we mentioned before, you cannot terminate this employee due to an arrest. You could suspend him without pay, until after the trial, and put him back to work if he is found innocent. We do not suggest that because there is still the potential for additional violence.

    You should strongly encourage the victim of the assualt to get a restraining order against the aggressive employee. (This is called an order of protection in some states.) This judge’s order will prohibit the aggressor from being within a certain distance (maybe 100 feet, or 300 feet) of the employee. This restraining order will make it impossible for the aggressive employee to work at the same facility as the victim. If the aggressive employee shows up for work, he is in violation of the restraining order and you should call the police to escort him off the property. After a few days, you will terminate him for unexcused absences. He will probably not qualify for unemployment benefits.

    Note that there is no law that requires you to reassign the aggressive employee due to a restraining order, and we do not recommend it. Everyone at your workplace will be much safer if this employee is gone.

    When terminating the aggressive employee, you need to be as diplomatic as possible. Have several witnessess present. Tell him the decision has already been made to end his employment and that unfortunately, there is nothing that you can do about it. Also let him know that unfortunately, you cannot allow former employees on company property at all. Have several large people immediately escort this employee to his car and wait until he is off the property. (Take whatever steps necessary to return his personal property, such as cutting the padlock on his locker or packing up items on his desk and mailing them to him.) Get his address so his final check can be mailed — you do not want this employee on the property ever again, for any reason.

    Be especially wary during this process. In a number of recent shootings, the employee has gone to the car, retrieved a gun, and returned to the workplace to shoot employers or coworkers. If you are concerned about this, consider having police officers present in the parking lot. However, be aware that the presence of police may also incite the aggressor to more violence.

    If the employee returns to the property at any time in the future, you need to immediately dial 911 and assume that he is armed and has violent intentions. Every supervisor needs to be aware of this procedure. Better safe than sorry. Also check OSHA’s guide for preventing workplace violence at http://www.osha.gov/SLTC/workplaceviolence/. You need to make the company premises as secure as possible, possibly keeping doors shut and locked or changing the locks.

    This is a complex situation, and we suggest that you consult an attorney before making a final decision. Remember that this does not constitute legal advice. HTH, and thanks for reading the blogs!~ Amelia

88. Posted by: Jennifer

    Hi Amelia,

    I just had a quick question regarding payroll errors. We had an employee who received another employee’s pay check on his pay card by payroll error. We cut the employee that did not get paid a paper check. The employee admitted to getting the money on his card and spending it.Is it legal for us to withdraw his whole pay check until we collect the funds that were given to him in error.

89. Posted by: Amelia

    Hi Jennifer! This depends upon which state the employee is in.

    Due to a payroll error, Leon was paid wages that should have gone to Tatiana. Let’s look at the two employees separately. Tatiana was not paid. You were correct to cut her a payroll check immediately.

    Leon was overpaid, and it sounds like he was overpaid substantially. In most states, this would legally be considered an advance against future wages. In other words, if Leon was paid an extra $2,000 last week, he was paid in advance for the next $2,000 he earns from this company. In those states, you could legally make a deduction to his paycheck for the entire amount of the check, until that $2,000 was paid back.

    If this deduction was for any other purpose other than an advance payment, it would be illegal under federal law. That’s because federal law requires that the employee be paid at least minimum wage for the hours worked in that payroll period. But in this case, under federal law, Leon was paid more than the minimum wage, and he was paid it in advance.

    In California, you would not be able to recover the amount. Payroll errors are the responsibility of the employer, and cannot be recovered from employees in most cases in California. Other states would also limit this deduction, so you might want to post another comment and mention your state.

    Some employers would handle this differently, especially if this is a long-term, valued employee with good performance. In that case, the employer might pay the employee the minimum wage each week, and deduct the remainder of the paycheck until the overpayment is repaid. HTH, and thanks for reading the blogs!~ Amelia

90. Posted by: Vanessa

    Thank you for posting to this blog Amelia. I have learned so much! Can you please explain in plain English the “administrative production dichotomy” in the office enviroment? My staff is small (under 10) and we are in California. I have 2 employees with the title manager and 5 with the title coordinator. The managers are exempt, the coordinators are not. I have an employee who has the title manager and feels she is not exempt because she feels she on on the production side. We are an association that creates networking events and her job is to plan the events. She does not sign contracts and has to clear any ideas through me and or the committee, and does not directly supervise any of the staff. This is why she feels she is not exempt.

    I believe she is exempt because she does assist me at times, she meets the wage test, and I do not manage her time. She works on what she wants to work on. I do not account for her time. I also need clarification on the term “discretion and independent judgment” What are your thoughts?

91. Posted by: Amelia

    Hi Vanessa! Sorry, but we have to side with the employee on this one — she does not fit the California definition of an exempt employee, which is more rigorous than the federal definition.

    Job titles have nothing to do with whether an employee is exempt or not. You could call all of your employees managers or call all of them dogcatchers, for that matter. Their exempt/non-exempt status is determined by their primary duties, not the title.

    An administrator must exercise discretion and independent judgment in order to be exempt. “Discretion and independent judgment” generally means making decisions that have a financial impact on the organization, without permission or oversight. For example, a purchasing agent who decided which vendors to use and what price to pay for supplies, would be an exempt administrator. A purchasing agent who merely phoned in orders to approved vendors, and had to get permission to switch vendors (or have that decision approved) would not be an exempt employee.

    It sounds like you think this employee should be exempt because you do not micro-manage her time. However, this is not sufficient control to make an employee exempt. (If it were, you would simply allow all of your coordinators to go to lunch at their preferred time, and avoid all overtime.)

    If this manager had the unilateral power to decide which venues to use, and what prices to pay for goods and services, with the power to sign contracts, she would be an exempt employee. But she does not, so in our best opinion she is a non-exempt employee.

    In California, an exempt employee also cannot be involved in production. This is a gray area at your organization — a good lawyer could make a strong case that this employee is involved in the production of the services (networking events) that your organization sells. Our advice in California is always that the employer err on the side of caution. Even if you “win” a lawsuit with the DLSE, it could cost your association over $100,000 in attorney’s fees. Our advice is that you consult the DLSE or an attorney specializing in employment law. Unless they agree that this employee is unquestionably exempt, you should treat her as a non-exempt employee.

    Having said that, if you change this employee to non-exempt status, there is no requirement that you keep her at her current salary. Suppose she earns the equivalent of $20 per hour as an exempt employee. If you change her to non-exempt, you could pay her $10 or $12 per hour, plus overtime, as long as she is informed of the change well in advance. There would be no need to change her title or duties.

    Another option, of course, would be giving this employee more independent decision-making authority so she meets the requirements of an exempt employee. HTH, and thanks for reading the blogs!~ Amelia

92. Posted by: Kathy

    Hi Amelia,
    In KY, how many hours can an employer require an exempt salaried employee to work? Maximum? Minimum?

    Thanks!

93. Posted by: Amelia

    Hi Kathy! It’s nice to hear from you again!

    Neither Kentucky nor federal law limits the number of hours that an exempt employee can be expected or required to work. This is true of almost every state. It is up to the employer to establish the expected work week for an exempt employee. An exempt employee who does not work the expected hours in the work week can be disciplined or terminated.

    One of the major ways that employers are saving payroll dollars during the current financial crisis is by requiring exempt employees to work more hours, even filling in for hourly employees.

    An exempt employee who works any portion of the day must be paid his or her entire salary for the day, even if the employee comes in late or leaves early. However, the employer can discipline or terminate the employee for not meeting the performance expectations by working the expected hours.

    Employers are also free to establish the maximum number of hours that an exempt employee can be required to work. Or, as one of our favorite Department of Labor lawyers puts it, the maximum is 168 hours per week. That’s 7 days x 24 hours per day. An employer can legitimately require an exempt employee to work 60 or 70 hours (or more) per week, every week. In a few industries, exempt employees are often expected to work 120 or more hours per week. Any expected work week is legal in Kentucky and most other states. The only exception would be if the exempt employee is covered by a union contract.

    Some examples:

    Tina’s employer hired her with the understanding that she would be a part-time exempt employee. Tina usually works 25 hours per week, however occasionally Tina works 40 or 50 hours in a single payroll week. Tina is not entitled to any extra compensation when she does so.

    Robb’s employer expects exempt employees to work at least 40 hours per week. One week, Robb came in late one day and left early another day, working only 38 hours in the payroll week. Robb’s employer must pay his full weekly salary, but can discipline or terminate Robb for not working the expected hours.

    Ted’s employer expects exempt employees to work 55 hours per week. Ted usually works 60 hours per week or more, and is not entitled to any additional compensation when he does so. One week, Ted works 5 days but only 40 hours during the week. Because Ted is not taking time off under FMLA or ADA, he can be disciplined or terminated for not working the expected hours.

    Note that the employer should have similar expectations of exempt employees in like jobs. Expecting one accounting manager to work 67 hours per week while another person with the same job is expected to work 40 hours per week would likely be illegal discrimination. HTH, and thanks for reading the blogs!~ Amelia

94. Posted by: Jeff

    Hello-

    I and my co workers went through all of 2009 with a 20% pay cut. At first we were told we could take 1 day a week off. This was retracted during the first week probably because of the “worst case scenario” you describe above.

    As we enter 2010 a question occurs to me.

    If the pay cut is permanent would any future pay increases coming to us be based on our current lower salary or would the employer more likely keep us at this lower level permanantly?

    Also do we need to agree to the pay cut every year or since we agreed the one time does that meet the legal requirement for the company permanantly?

    It sounds like I will have to leave the company to ever get more pay.

    Thank you.

95. Posted by: Amelia

    Hi Jeff! When an employer reduces an exempt employee’s salary, in order to be lawful, that reduction must be permanent. In this case the legal definition of “permanent” is that the salary reduction must last at least 3 months. However, we will say that in the current economy, the more common definition of “permanent” is permanent.

    There is no need for the employee to agree to the “wage reduction” annually. In fact, there is no annual wage reduction. The employee’s wages were changed, once and for all. Some employers have the intention of restoring wages to their previous level if and when the economy improves. In some cases, this is impossible because company revenues are still down. Any future increases would be based on the employee’s current (reduced) salary.
    Before you quit your current job, be aware that according to SHRM the average exempt employee has taken a permanent 25% pay cut since 2007 — and that survey only counts people who are employed. The unemployed have had a 100% pay cut, many of them for 2 years or more.

    If you feel you are underpaid, by all means test the market by looking for a higher-paying job. But our advice is that you keep this job until you find a better one. HTH, and thanks for reading the blogs!~Amelia

96. Posted by: Kathy

    Hello again,

    Apart from manufacturing furniture we also have a separate trucking company. I wanted to get your opinion on something. Sometimes our truck drivers take along a passenger on their trips (usually a family member). We are currently reviewing and updating this policy. We have a wavier which each driver and passenger must sign before taking a trip. Our wavier states, that the passenger and family members relieve our companies from any and all responsibility. We haven’t had problems before but we want to make sure we are covered if anything should happen. I am also discussing this with our insurance company and attorney but would really like your opinion. Would having a wavier protect the company if and incident were to happen? Even if it was our driver’s fault? Is there anything that we need to make to state on the wavier? Would you recommend having an age limit for the passengers? Would you even recommend allowing the drivers to have passengers on their trips?

    Thanks!

97. Posted by: Amelia

    Hi Kathy! The important point to keep in mind is that there is no waiver in the world that will protect you if a court finds that the company was in any way negligent. Suppose the brakes fail on the truck and the passenger is injured or killed in an accident. Despite the waiver, this is your responsibility and the company will be financialy liable. As you have noted, even if the driver is distracted by the passenger and that causes an accident, your company may be liable for that action by one of its employees.

    A waiver also won’t protect you from legal fees. Suppose in the first example, the heirs sue you, claiming that the company was negligent. Even if you win the suit, you could easily spend $100,000 or more in attorney’s fees. If your insurance company is willing to pick up that cost, then it’s okay. But in many cases, you as the employer would be responsible for those fees because the victim was not an employee.

    Our advice would be to not allow passengers unless your insurance policy will cover them at a reasonable cost. Allowing passengers probably improves driver morale; you have to balance that benefit with the cost of providing insurance for the passengers.

    Issues like this are why many companies outsource their trucking and transportation needs. Ultimately we will defer to your attorney on this issue. He or she knows a lot more about your business situation. HTH, and thanks for reading the blogs!~ Amelia

98. Posted by: Kathy

    Amelia,

    In our handbook it states: “Paid personal time will be used before any unpaid time off is granted. Any unused paid personal time will be forfeited at the end of the year.”

    We have a salaried supervisor who has a history of chronic absenteeism, coming in late, leaving early, leaving after working 1-3 hours, stating that she is sick. This situation had been addressed last year and improved, however this habit is occurring again. Salaried supervisor worked 7-10am, then sent an email stating she had the stomach bug and was going home. Realizing that she is to receive a full day’s pay. Legally can we burn 4 hours of her personal time she has available to her? (She will still receive full paid, just be docked personal time).

    Thanks!

99. Posted by: Amelia

    Hi Kathy! Yes, in Tennessee you can reduce an exempt employees personal time, sick time, vacation or paid time off when she works less than a full day. (In California, this would be unlawful.) We assume that this employee is not entitled to time off under FMLA or ADA. You are correct that you must pay the exempt employee’s full salary for that day, because she worked part of the day.

    If the employee was supposed to work 8 hours, and left after 3 hours, you can charge her for 5 hours of personal time.

    However, if you take this action against only one employee, that could well be illegal discrimination, even if that was not your intention. Suppose this employee is the only Hispanic supervisor, or one of just a few female supervisors. Other supervisors who work a partial day are not required to use sick leave or personal time. This would have the effect of creating worse working conditions for the female or Hispanic supervisor, compared to other supervisors. So if you do this with one employee, you must also do it with all exempt employees who work a partial day.

    We would recommend that you take an additional step. An employer has the right to set the expectation for the number of hours an exempt employee works each week. You can set a standard that exempt employees are expected to work 40 hours or 50 hours or whatever, each week. An exempt employee who does not meet that expectation can be disciplined or terminated. We would suggest that you write the employee up for not meeting your minimum performance expectations. After three writeups, she would be terminated for poor performance.

    When an attendance problem has gone on for this long, it seldom improves permanently. HTH, and thanks for reading the blogs!~ Amelia

100. Posted by: Kathy

     Sorry that post was from me. In your response you said that this was allowed in Tennessee but I want to make sure it was allowed in Kentucky also.

     Thanks!

101. Posted by: Amelia

     Hi Kathy! Yes, this is legal in Kentucky also. ~ Amelia

102. Posted by: Kristin

     Hi Amelia- ok, now I am totally beating a dead horse. I explained the production/administrative dichotomoy to my boss and explained to her why I feel I am not exempt and we should correct it. She says she took it to a lwayer who never responded to her. So, today she tells me she is switching my exemption status effective the next pay period only becuase she will spend more money fighting me in court. I asked her about retro and she says she does not owe me retroactively because I am really exempt, she just doesn’t have attorney fees in the budget. I am in california. I know you said to file a claim. My question to you is- By her changing my status after my inquiry, doesn’t that show that I have been exempt since my duties have not changed?

103. Posted by: Amelia

     Hi Kristin! No, her switching you to non-exempt does not prove anything. It is legal for an employer to treat any employee, even the CEO, as non-exempt.

     Apparently, the employer’s position is that your duties genuinely qualify you as an exempt employee. However, beginning the next pay period they will treat you as a non-exempt employee and pay overtime. That is entirely legal. Any employee CAN be paid overtime — it’s just that some employees MUST be paid overtime. Currently, you believe that you belong in the latter group and your employer believes that you belong in the former group.

     We are not surprised that no back pay is mentioned. An employer almost never voluntarily pays back pay for overtime. Why should they, unless someone forces them to? Our advice is still for you to file a wage claim with the California DLSE. If you were genuinely an exempt employee and not entitled to overtime, they will tell you. If you are entitled to overtime, they will give the employer the choice of paying you back wages or being sued. Any smart employer would choose to pay the back wages. HTH, and thanks for reading the blogs!~ Amelia

104. Posted by: Kathya

     Ameila,

     Are we required to keep up-to-date driver’s licenses for employees who are citizens, for I-9 purposes? They are office and production employees. If so, are we also required to let employees know that their license will expire, like we do with work authorization cards?

105. Posted by: Amelia

     Hi Kathya! The first thing we need to say is that it is illegal discrimination to treat employees who are not U.S. citizens differently from those who are citizens. This type of discrimination seems to be at the heart of your question. You cannot have one set of standards for office employees who are mostly U.S. citizens, and another set for warehouse employees who are almost all immigrants. Just wanted to clear that up.

     There are a variety of different documents that any employee can use to prove identity on the I-9, including a driver’s license, passport, work authorization card or other document. The employer cannot dictate which document the employee will submit. So if an employee submits a passport, you cannot require a driver’s license instead, for I-9 purposes.

     However, yes, the document on file must be unexpired. So whether the employee submits a driver’s license, work authorization card or passport, if it expires, you as the employer are in violation of this regulation. Yes, you should inform employees when their identity document is going to expire, and take pains to obtain a copy of the new document, regardless of which type of document is submitted. HTH, and thanks for reading the blogs!~ Amelia

106. Posted by: Kathy

     Ameila,

     If we had employees who were terminated for false documentation, do we still give them their W-2? We have many employees who have called to change the address that they were going to be mail to, but I’m unsure if we are still obligated to give them W-2’s knowing that the documents that they presented were false and that they are not this person.

     Thanks!

107. Posted by: Amelia

     Hi Kathy! Every employee is entitled to a W-2, so even employees who have subsequently been fired for improper documents must receive one. The best practice would be to have every employee complete a new W-4 and address update each year. Usually these are completed in early December for the following year — for example, in December 2009 the 2010 W-4 is completed. You should mail the 2009 W-2 to the address on the 2009 W-4. (By law, this should have been done in January.) If an employee calls to say that they did not receive the W-2, then you can mail a duplicate copy of the W-2 to the new address.

     Presumably, the undocumented workers were using someone else’s name and mailing address. Sending a W-2 to the original address will alert the victim to the fact that someone else is fraudulently working under thier name. As an employer, you have no responsiblity to protect employees who break the law.

     W-2s also go to the IRS, so if an undocumented worker has been using someone else’s social security number, the victim will find out when he or she files a tax return. However, if you genuinely believe that these former employees were engaging in identity theft, then you should report them to the police. They will most likely want both addresses for their investigation. HTH, and thanks for reading the blogs!~ Amelia

108. Posted by: Kathy

     We have mailed out all the 2009 W-2’s to the address we had on file on 12/31/2009 but we have got many returned back to us by the USPS. Some of these are former employees who were terminated after their documents were ran through E-verify and the information did not match or we received a letter from the IRS stating that information given to us was false and they are not really this person. I was asking this question because many former employees have come to pick these up or called in Jan.2010 to change their address. So even if we know that the person we are hand/mailing the W-2’s to is not “John Smith” we still must give them “John Smith’s” W-2? I just want to make sure before we mail the returned W-2’s to the address given by the former employee or we hand them to people who we know are not the person listed on the W-2. Also what if one of these former employee (who were terminated because they presented false documentation) come in and want a duplicate copy of a previous years (2007) W-2? Do we still give them a duplicate even if the original was mailed out and not returned to us? Sorry, I’m just trying to cover all basis.

109. Posted by: Kathy

     Amelia,

     What would be the best way to promote good hygiene without being discriminatory? A lot of of our employees come from 3rd world countries and their hygiene is now becoming an issue with other employees. We plan to have a meeting with every department to refresh everyone on some of the regulations that aren’t being followed or enforced like they should be and wanted to address hygiene also. But did not want to discriminate anyone, how would you suggest to go about this? The upcoming meeting is about a variety of rules and will be with every department within the company.

110. Posted by: Amelia

     Hi Kathy! This is a very common problem — and you are handling it in exactly the right way by having a general meeting. You don’t want to single out any employee or any group of employees for this discussion.

     Instead, have a meeting and talk about other policies and procedures (maybe tardiness and absenteeism.) Then bring up the dress and hygiene code. Remind everyone that this is important because it affects their coworkers (and customers if that applies to your business.) Use inclusive language such as “we all need to be aware of our personal hygiene…” Remind everyone that the expectation is that they will take a bath or shower each day, using soap and deoderant, and putting on clean clothes afterwards. They need to keep their hair and nails clean and neatly trimmed. They should brush their teeth twice per day and use mouthwash. Men should shave daily, or (if you allow them) keep beards neatly trimmed. For someone who perspires a lot, it may be advisable to use a light cologne or aftershave. Stating the expectations this explicitly should go a long way toward solving the problem. (Many people think “good hygiene” means taking a bath or brushing their teeth once a week. )

     By having this conversation with every employee at a meeting, you are avoiding discrimination. After all, you do expect ALL employees to practice good hygiene.

     Unfortunately, there is no perfect solution to this problem. If a problem persists a few weeks after the meeting, a same-sex manager may need to have a private conversation with the employee. Some employers prefer to do this by leaving the employee a note, if that is feasible. HTH, and thanks for reading the blogs!~ Amelia

111. Posted by: Amelia

     Hi Kathy! Re: The W-2s, you should still be okay with giving or mailing out new ones, because the person who worked for you is the person who is entitled to a W-2 from you. However, let me do a little more research on this and get back to you. HTH, and thanks for reading the blogs!~ Amelia

112. Posted by: Kathy

     Ameila,

     Regarding hygiene, we have some employees that do not understand English. We normally hire a translator to ensure the employees understands what we are trying to get across. Would it be discriminatory if we still had a meetings through out the company with every department but also had a group meeting with those who do not understand English and a translator, separately? I’m asking this because there are many different languages in our company.

113. Posted by: Amelia

     Hi Kathy! The ideal solution would be to have all of the employees at the same meeting. If you want to have all the employees from one department at the same meeting, that is fine. You (or another manager) would speak in English and the translator would translate your words into as many languages as necessary. This is the best practice in HR for companies where employees do not speak English. It ensures that everyone is hearing the same information. It costs a little more, because everyone will attend a 1-hour meeting instead of a 30-minute meeting. But that is much less expensive than one discrimination lawsuit.

     You could have one meeting for all employees who speak English, one for Spanish speakers, one for Italian speakers, etc. However, you should have a written agenda and discuss the same items at each meeting, to avoid discrimination. So even if you do not know of any Italian-speaking employees with hygiene problems, you need to discuss it in the meeting. Again, this avoids the claim of illegal discrimination based on different working conditions for different groups.

     Yes, by having separate meetings of non-English speakers, it creates the appearance that you are illegally discriminating against employees based on their country of origin — that you have one set of standards for native speakers of English, and another for other employees. This is bound to create resentment between the two groups, and lower employee morale for the non-English speakers. Having this sensitive discussion with all the employees at the same time (even if you have to pause periodically to have it translated) makes it clear that you have the same standards for all your employees.

     A long-term solution to this problem would be to hire employees who can understand spoken English, or to hire at least one employee (or ideally, manager) who is bi-lingual in each language. For example, if you have employees who speak Hmong, you would hire one line supervisor who is fluent in Hmong and English. In the future, he would serve as a translator. (Obviously, this employee is more skilled than others and should be paid a little more.) It is not usually a good long-term strategy for an employer to have workers that no one can communicate with. HTH, and thanks for reading the blogs!~ Amelia

114. Posted by: Kathy

     Hi Amelia were you able to research more on the the W-2’s?

115. Posted by: Amelia

     Hi Kathy! We checked with a number of HR pros (and social security, but they have not gotten back to us yet.) You are obligated to provide a W-2 to the person who performed the work for you. If you mailed a W-2 to the address on file, it is okay for you to also mail a duplicate copy to the employee’s new address. This is true, whether or not the original W-2 was returned.

     W-2s are sent to the IRS and Social Security, as well as to the worker. So, if a worker has used someone else’s social security number, it should be fairly easy for the victim to discover this. But again, if you have reason to believe that one of your ex-employees is guilty of identity theft, you should contact the police. HTH, and thanks for reading the blogs!~ Amelia

116. Posted by: lynn

     I am an exempt salaried employee from West Virginia. Is it legal for my employer to take away my vacation time for the 2 days our building was closed due to weather conditions? they also gave us the option to take leave without pay? is there even such a thing as LWOP for salaried exempt employees? i worked 1 full day and 2 hrs on another day that week (the 2 hrs worked was because they shut our building down and made us leave due to the weather) i had no control over this i feel we should get paid for the full week… please help as our employer does this alot to us…

117. Posted by: Amelia

     Hi lynn! Both you are the employer are right. Under the federal FLSA, or Fair Labor Standards Act, an exempt employee who works part of the payroll week, and is ready, willing and able to work the entire week, must be paid his or her usual salary for the week.

     However, the employer can dictate when employees use their vacation time. So the employer can legally pay you for the week, but deduct 2 days of vacation from your balance, for the two days the business was closed. The FLSA requirement for payment addresses the total amount of money the employee receives. It does not address whether that time will be counted as vacation or not. (There is no state or federal law that requires employers to give paid vacations to workers. If the employer offers paid vacations to workers, the employer sets the policies for them.)

     The employer is actually trying to be generous by giving you the option of taking unpaid leave instead of using your vacation time. Of course Leave Without Pay or LWOP applies to exempt employees. FMLA is leave without pay and often employees are granted LWOP under ADA. In this option, you would inform the employer that you were not “ready, willing and able” to work on those 2 days. Because you would be taking those two days off for personal business, the employer could legitimately prorate your salary for the week. Some exempt employees would prefer this solution, because it would allow them to use their paid vacation at a later date. Other exempt employees would prefer to be paid for that time off, even if it results in them having fewer vacation days in the future.

     If an exempt employee had no vacation days available, and the business was shut for a portion of the week, the employee would still be entitled to his or her usual salary for the week. HTH, and thanks for reading the blogs!~ Amelia

118. Posted by: Miguel

     Hi,
     After almost 12 years with our Company we (5 exempt employees) suffered not one but several percentages of salary reduction in different occasions, this is went up and down (2009) at least six different times and know again at least once this year (Feb 12, 2010). We have been treated (I think) as non-exempt and exempt workers during these almost 10 past months (2009-2010). During 2009 reductions, it was mentioned that all reduced percentage accumulated will be reimbursed by the end of that same year and this never happened. During this 2010 and last 2009 year we never received a written notification of any of all reductions, all of them where verbal and only one of them (second of six) was a day before the reduction, the other five were the same day at least one hour prior of the paycheck delivery, reduction percentages went from a 20 to a 50%, this 2010 year we started in February with a verbal agreement to have a temporary reduction (no time range defined) on salary for all of us of a 10%, but when we were ready to receive our 90% paycheck a verbal notification of a 50% paycheck was informed with no promise of reimbursement of the rest (50%) anytime at all. We are in Texas, Is this kind of payroll payments are lawful? If so, why it is lawful? If not what do you recommend doing?

     Thanks,
     Best regards.

119. Posted by: Amelia

     Hi Miguel! We recommend that you contact the TWC, the Texas Workforce Commission, as soon as possible. No, these types of fluctation in salary are not lawful. This is not even a salary reduction. It is non-payment of wages, which is illegal under the Texas Payday Law.

     A Texas employer can legally reduce your salary, but you must be told before you perform the work that the salary will be reduced. Example: Suppose you are told on Monday that beginning Tuesday, your salary will be $500 per week instead of $600 per week. This is completely legal.

     But if we understand your post, in your case when payday came, you were paid only 50% of the original salary, or $300 in our example. This is completely, 100% illegal. Texas employers must pay all wages promised, and they must pay them on payday.

     In addition, under federal law, an exempt employee’s wages cannot vary from pay period to pay period. Any salary reduction must be for at least 3 months. We agree that you are not being treated as exempt employees and are probably due overtime.

     Contact the TWC at http://www.twc.state.tx.us/ as soon as possible. They will investigate and force the employer to pay the wages and overtime you are owed. HTH, and thanks for reading the blogs!~ Amelia

120. Posted by: Miguel

     Hi Amelia, well almost immediately I received this answer from the TWC, I felt more vulnerable than I tought we were as an exempt employee, what do you think about this answer? and do you think we can have any other option to make our paydays better (even with a fixed reduction) a not a “suprise-day”

     I replied him with this:
     “Hi David, me again. This happened again today, we are receiving our payroll checks and a minute later we received and e-mail that mentions that our pay will be 50%. Is this some kind of our company not wanting to pay us (avoiding) instead of defined that we are no longer exempt employees and we move to an hourly status. We are not in agreement with this reductions in any way and we think this is not the correct way of doing it (reductions). Your previous reply surprise me about how vulnerable we are as an exempt employee, is any paragraph on the Payday Law that creates or ensures a stronger protection to the employee against this kind of situations?

     Thanks again for your great help.
     Best regards.”

     Mr. Vega:

     Thank you for your message to the Texas Workforce Commission (TWC). TWC’s Labor Law section administers the Texas Payday Law, which assists employees in the recovery of their unpaid wages. According to the Texas Payday Law, an employer is obligated to pay wages for all time worked in accordance with the pay-rate agreed upon by the parties on the scheduled, posted paydays.

     The payment agreement can be oral or in writing. Under this law an employer can change an individual’s pay - increased or decrease - or change their job duties, as long as notification is given to the employee prior to the changes taking effect. (The law does not specify how far in advance the notice must be given.) These changes can also be oral or in writing. Normally, by continuing employment under these new conditions, the employee implies agreement.

     These changes however, cannot be retroactive since for there to be an agreement both parties must be aware of the conditions before they occur.

     If you believe your employer has paid you incorrectly, you can file a wage claim with this agency. Your wage claim would then be investigated under the provisions of the Payday Law.

     HOW TO FILE: Our web page at http://www.texasworkforce.org/ui/lablaw/lablaw.html offers detailed information about the Texas Payday Law, and there is a downloadable claim form at http://www.twc.state.tx.us/ui/lablaw/ll1.pdf. Wage claim forms are also available at most full-service Texas Workforce Centers. The Texas Payday Law states that the employee who files a wage claim must do so within 180 days after the date the contested wages were due for payment.

     MAILING ADDRESS: You must submit the wage claim form by regular mail to: TWC Labor Law Section, Room 124T, 101 East 15th Street, Austin, Texas 78778. You can send any additional information, questions, or correspondence to the Labor Law Section by fax to (512) 475-3025, or by regular mail to the address above. We regret that currently we do not handle claim correspondence or status information by e-mail.

     If you have additional questions regarding the Texas Payday Law call our Public Information line toll-free at 1-800-832-9243/TDD 800-735-2989 (within Texas only), or call the main number 1-(512) 475-2670. Office hours are 8:00 a.m.- 5:00 p.m., Monday through Friday. After office hours, our automated telephone system can answer many of your questions.

     Thank you for contacting TWC.

121. Posted by: Amelia

     Hi Miguel! Actually, the TWC is saying exactly the same thing that we already told you– your employer can reduce your wages, without your permission. However, that reduction cannot be retroactive. Meaning, it cannot apply to the check you receive today, only to your next paycheck. You need to follow the instructions to file a wage complaint with the TWC. Anything else is just spitting into the wind. Until you file a wage complaint, the TWC cannot do anything.

     The TWC is correct that when the employer informs you of the wage reduction, and you continue to work, you have accepted the lower wages.

     The employer can also change your status permanently to non-exempt employees, and pay you only for hours worked. However, again, if you are informed today, that change can begin tomorrow. But it cannot apply to the paychecks issued today, for time worked last week.

     That’s really all there is to it. You can file a wage claim with the TWC, or you can let the employer continue to do this. The choice is yours. HTH, and thanks for reading the blogs!~ Amelia

122. Posted by: Kathy

     Amelia,

     Did you ever hear anything else about the W-2’s? Also I had another question, we have many former employee who are returning to apply for jobs, some of these are employees where terminated about 5 years and are not re-hirable. I would think that they were told that they were not re-hirable at the time of termination but we had a different staff back then, so I’m not sure. Legally are we allowed to tell a person that they are not re-hirable? Also are we obligated to give them specific reasons on why this decision was made, if they ask? I’m sure the former employees know why they were terminated but they still ask.

     Thanks!

123. Posted by: Amelia

     Hi Kathy! On the W-2s, you are allowed to send the documents to a new address, that was not on the original 2009 W-4. As an employer, failing to provide a W-2 to an employee or former employee is a violation of the law. The employee is the person who worked for you.

     There is no law that would prevent you from telling a former employee that they are non-rehirable. This is a judgment call. Many HR pros would sidestep the issue. People tend to become belligerent when they are told they will not be hired, or that they are not rehirable. Sometimes the worker even becomes violent under these circumstances. The safest course would simply be to take the application and never call the worker back. If they call repeatedly, you can tell them that you are still interviewing or that the position has been filled.

     Going into specific reasons why the employee is non-rehirable will often result in confrontation, and sometimes the employee will become violent. It is better simply to sidestep the issue. HTH, and thanks for reading the blogs!~ Amelia

124. Posted by: Kristin

     HI Amelia,

     I have a question about liabilty. I use my personal vehicle to drive for work related errands. We are compensated at the AAA mileage rate. During one of my trips of about 300 miles, my car broken down and I incurred the cost of about $2,000 for repair plus towing. My terms of employment state I must keep valid car insurance and drivers license. I am in california. I am not a driver by profession. Is my employer legally obligated to help with the cost of the repair?

125. Posted by: Amelia

     Hi Kristin! No, even in California the employer is not responsible for your car repairs, even if the car happens to break down while being used for business.

     When the employer pays a specific amount per mile, that rate is intended to include gas, oil, and normal wear and tear on the auto. So in a sense, the employer has already paid his or her portion of this car repair — they pay it every time they reimburse you for mileage. The AAA rate takes into account the total cost per mile of operating a vehicle over a period of years — including maintenance. HTH, and thanks for reading the blogs!~ Amelia

126. Posted by: Katherine

     Hi Amelia,
     What great blog you have here! I have several questions.

     1) I am an exempt employee in California, I work a 45 hour weekly schedule. I read elsewhere that my hourly rate would have to be at least double minimum wage to be exempt, but at 45 hours a week, it isn’t. Am I “exempt”?

     2) We have a combination of paid and unpaid holidays, I am supposed to make a certain amount per year, but I don’t because of the unpaid holidays. Is that normal and/or legal?

     3) We are required to adhere to a very specific and strict dress code, we have to purchase specific suits and specific outerwear, we were told that it is called a dress code now, when it used to be called a uniform. The requirments are exactly the same. Is this normal and/or legal?

     Thanks!
     Katherine

127. Posted by: Amelia

     Hi Katherine!

     Thanks for the kind words! To answer your questions:
     1) Our reading of the California code is that an employee must be paid at least (40×2x minimum wage = weekly salary) to be exempt. Once that minimum salary requirement is met, the exempt employee can be required to work any number of hours in the week without additional payment. However, you may want to call the DLSE, the California Department of Labor Standards Enforcement, to have them make a decision on your specific job.

     2) Yes, this is normal and legal. Although salaries are often stated in terms of annual earnings, the legal requirement is that employees be paid for the time they work. (However, note that as an exempt employee, you should be paid your full salary for the week, even if the place of business was closed for one or more days, as long as you were ready, willing and able to work on those days. If your salary is prorated during weeks in which the business is closed for a holiday, you are being treated as a non-exempt employee, and you are entitled to overtime.)

     3) Under California law, the employer must pay for uniforms. It appears that the employer is trying to skirt the law (ha-ha) by calling a uniform a dress code. If you cannot wear any suit or outerwear except that provided by the company, and it has a distinctive design, then it is probably a uniform. Contact the DLSE about this, and they will enforce it. HTH, and thanks for reading the blogs!~ Amelia

     Read more about exemptions at: http://www.dir.ca.gov/dlse/FAQ_OvertimeExemptions.htm

128. Posted by: Kathy

     This is regarding I-9 documentation. In the USCIS Handbook for Employers (M-274), it states that an Alien Registration card/Permanent Resident card or a List B document does not need to be re-verified upon expiration date. I just want to make sure I’m understanding this correctly. So when these documents are expired do we need to inform the employees? Do we need the employee to present documentation that is not expired? What is the procedure for an expired Alien Registration card/Permanent Resident card or a List B document? What about when an employee gives us a D.L. and a S.S. card for their I-9 documentation, do we need to keep the D.L. up to date? I’m a little confused.