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BOOKKEEPING

Do You Have to Pay Employees for Snow Days?
 

You still need to hand over a paycheck for a snow day in most cases, according to the Labor Department.
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A snowmageddon such as the storm experienced by much of the United States this week isn't just a logistical nightmare for those trying to travel – it can create conflicts between workers and managers at small businesses.

The most-common question: Do you have to pay employees for snow days? (And the inevitable follow-up question: How much will they hate you if you don't?)

Here's what the U.S. Department of Labor wrote about snow days in a pair of opinion letters. (Opinion letters aren't the same as law, but courts tend to defer to them and they're a useful guide to how the DOL would rule, according to Business Management Daily.) If your office is closed because of bad weather, you can't dock pay, but you can require exempt employees -- in other words, those not paid hourly, and who are therefore not subject to the Fair Labor Standards Act  -- to use accrued vacation or leave for the missed day.

Because the Labor Department says that FLSA doesn't require you to provide vacation to employees, it's up to you how to run your leave program in any way you choose, as long as it's nondiscriminatory. So you can also charge employees leave in amounts less than a day as long as the employee's salary doesn't change. If an employee doesn't have enough leave to cover the snow day, you can, of course, grant it now and let he or she make it up later.

If you're dealing with hourly employees, you'll have to pay them. Wrote the Labor Department in letter FLSA2005-46: "If an employee is ready, willing and able to work, deductions may not be made for time when work is not available."

If your office is open, you can subtract a full day's pay from an absent exempt employee's salary – yes, even if lack of transport is the problem. The letter reads: "The Department of Labor considers an absence due to adverse weather conditions, such as when transportation difficulties experienced during a snow emergency cause an employee to choose not to report for work for the day even though the employer is open for business, an absence for personal reasons. Such an absence does not constitute an absence due to sickness or disability."

Another option: Let the employee decide whether to use a vacation day. You can't, however, deduct partial pay for a partial absence -- that would make the employee subject to the FLSA. No matter how long he or she shows up for, you'll need to pay for the entire day.

The one thing the Labor Department stresses in any situation is that employers need to have a   
"clearly communicated policy" about salary deductions due to inclement weather, and it needs to include a complaint mechanism and reimburse employees for any improper deductions. Observed Business Management Daily: "Employers who frequently make improper salary deductions or have no workable system for resolving disputes won't fare well in court."

As for whether employees will hate you for a strict policy, consider this advice from George Cloutier, the founder and chief executive of American Management Services and author of Profits Aren't Everything, They're the Only Thing: "The concept that if you love your employees they'll perform is on the edge of insanity," Cloutier told the New York Times. "It's not that you want to hurt your employees, but you have a mission. You're paid to produce results. You have to treat employees with respect, but work needs to get done."

"The abandonment of that principle," he adds, "is a large factor in the failure of small businesses to achieve real profitability."

Last updated: Feb 11, 2010

Inc. contributing editor COURTNEY RUBIN was for five years a London-based staff writer for People magazine. Rubin, a former senior writer for Washingtonian magazine, has written for the New York Times magazine, Time, Marie Claire, and other publications. She is the author of The Weight-Loss Diaries.




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