Ensure That You Pay Exempt Employees Correctly for Employer-Initiated Snow Closures in Business and at Work

As I write this, we’re in the midst of a winter storm (technically, it’s a late-fall storm, as winter does not officially begin until December 21st) hitting the greater Capital Region in New York state that closed all local colleges, universities and K-12 schools the Sunday night after Thanksgiving for the subsequent Monday / first day back to work after the holiday weekend.

Along with the school closings, some employers have already decided not to open their offices / buildings this Monday due to the snowstorm, particularly if local authorities declare road emergencies banning drivers from roads required to commute to work.

From an article on the Society for Human Resources Management (SHRM) website in response to a common inclement-weather closure question from employers:

Do we have to pay employees when we close our business due to inclement weather?

• Nonexempt employees: Under the FLSA, employers are only required to pay hourly, nonexempt employees for hours worked. Some states do have “report-in” or “call-in” pay laws that require employers to pay nonexempt employees if they show up to work as scheduled but are sent home or sent home earlier than scheduled. (Here’s the current NYS Call-In Pay regulation.) Employers should check their state laws for such requirements. Otherwise, employers are not required to pay hourly, nonexempt employees for business closures or early closures. 

• Exempt employees: Exempt employees almost always must be paid when they work any portion of a workweek, including situations of inclement weather and natural disaster. The DOL provides a list of the instances in which an employer is permitted to dock exempt employee pay, and business closures are not one of the permitted deductions. If an employer sends exempt employees home early because of inclement weather or pending natural disaster, an employer is obligated to pay exempt workers for the entire day. If an employer decides to close for an entire day because of inclement weather, an employer is still required to pay exempt employees for the entire day. The only instance in which an employer is permitted to not pay exempt employees because of inclement weather or a pending natural disaster is when a business closes for an entire week and exempt employees perform no work during that week. There is also no obligation to pay an exempt employee when the business remains open during inclement weather and an exempt employee chooses to take the entire day off for personal reasons.

The answer to this question gets tricky when exempt employees run out of paid time off (PTO).

As for exempt employees, FLSA (Federal Fair Labor Standards Act) allows the substitution of PTO for regular wages, as long as the exempt employees receive their fixed weekly salary. See DOL Opinion Letter FLSA2005-41.

If a nonexempt employee has exhausted their PTO, absences or early departures due to the employer’s business closures are generally not compensable with the exception of any state report-in pay laws.

If an exempt employee has exhausted their PTO, an employer must still provide exempt employees guaranteed salaries for closures of less than a full workweek in these situations.

Do you ensure that you pay your exempt employees correctly for weather-related, employer-initiated snow closures in business and at work?