If you are like me, you have been focused on all things weather-related the last day or two. In Southwest Florida, we are firmly stuck in the “cone of uncertainty” in the path of Hurricane Irma, a storm the weather-folks keep calling “potentially catastrophic.” There were even rumors of a Jim Cantore sighting in Fort Myers yesterday…and anyone who has lived in Florida for a hurricane season or two knows what that means!
I know many of you are working on storm preparations, which, with a storm of this magnitude, naturally means you are faced with potential workplace closures. If the number of questions I received yesterday is any indication, there is a lot of uncertainty about when and how to pay employees if your business closes before and/or after the storm.
Impact of Workplace Closure on Payroll
Whether an employee must be paid during a weather-related office closure comes down to whether the employee is exempt or non-exempt. For non-exempt employees in Florida, the answer is pretty simple: the non-exempt employee (generally, hourly employees) does not have to be paid if the business closes and he/she is not working. You can (and should, in my opinion) allow the employee to use any accrued paid leave during the closure.
With respect to exempt employees, the determination is not as simple. If an exempt employee has worked at all in a work-week, the employee must be paid his/her regular weekly salary, with only a few limited exceptions. This is true even if your business closes. That means if you have been open part of this week, but plan to close Thursday and/or Friday for storm preparations, your exempt employees must be paid for the full week if they worked at all before the closure. You can require them to use any accrued paid leave; however, if they do not have leave accrued you still must pay the regular weekly salary.
One exception to this rule is when the exempt employee chooses to take time off for storm preparations, but your business remains open. If that is the case, and the employee takes a full day off, you can deduct that full day absence. If it is just a partial day, though, you still have to pay the entire day. You can allow (or require) the employee to use accrued leave for the absence, irrespective of whether it is a full day or partial day.
In looking ahead to next week, if the storm forces your business to close for part of the week, the same principles apply. If you are forced to close for the entire week, you do not have to pay exempt employees their weekly salary (assuming they are not otherwise working). If you only close for part of the week and the exempt employees work at all, they must be paid for the entire week. You are, however, permitted to selectively call employees back to work, as long as you do it in a non-discriminatory way. This means that if you can get by next week with only your non-exempt employees, or a limited number of exempt employees, you do not have to call your entire workforce back to the office. This can help mitigate the financial losses that may be caused by the business slowdown.
I wish everyone in Irma’s path the best as we prepare for this historic storm. Please be safe out there!