This past week I had an opportunity to attend an Employment Law seminar conducted by the law firm of Drew, Eckl & Farnham, LLP. I have been a couple of times before and last year did a post about the session, Lessons in Ignorance: The Intersection of FMLA and Workers’ Comp. What I like about their sessions is the method they use. They use scenarios to pose questions to the audience, then elicit typically a variety of answers. This year, as last, I was amazed at the many incorrect answers given to the questions. I will be posting more about some of the answers in days to come, but for this time around I wanted to discuss the Salary Basis test that must be met for Exempt status to be conferred.
According to the FLSA the salary basis test has the following elements:
- Regularly receives a predetermined amount of compensation each pay period (on a weekly or less frequent basis)
- The compensation cannot be reduced because of variations in the quality or quantity of the work performed
- Must be paid the full salary for any week in which the employee performs any work
- Need not be paid for any workweek when no work is performed
I want you to note the third bullet point. This means you owe an employee a full week’s pay even if they only work ONE hour in a week (and possibly even less.)
I make this point because in today’s environment of smart phones and laptop computers when is an employee NOT working. I know I read and respond to emails on days when I am “off” or even on vacations. Granted I am my own boss, but I am sure you have salaried exempt employees who do the same thing. This means that they are working.
So I have some simple scenarios I want to pose to you and ask you to respond with your answers. Lawyers are allowed to answer, but I want some of you SPHR’s to respond as well.
- An employee who is on vacation and having days deducted from the PTO bank works three days answering emails for an hour each day. Are they entitled NOT to have those days deducted from the PTO bank?
- Under the FLSA you can deduct from a salaried exempt employee’s check if they are suspended for disciplinary reasons for violating significant safety rules. However, while suspended the employee answers emails and makes business related calls. Does this nullify the deduction for the suspension?
- An employee has exhausted all their PTO days. They now have to be out for personal reasons. Normally you would be able to deduct for those days, however, during that time they do some email and answer phone calls for a half hour a day. Does this nullify the pay deduction?
Let me know what you think. You can leave a comment by clicking on the word Comment at the top of the post.