In some states, winter is coming. In other states, winter has arrived in full force. Many offices will have to close at some point this season due to inclement weather. This brings the question: do you have to pay employees when your office is closed for weather-related reasons?
You can bet our partners at HR Support Center know the answer to this one. Read on...
If our company closes due to inclement weather, are we required to pay employees?
Answer from Eric, HR Pro:
Non-exempt employees need to be paid only for actual hours worked plus any reporting time pay that may be required by the state. In accordance with the Fair Labor Standards Act, however, exempt employees must be paid when the employer closes due to inclement weather.
This is an area where you should also be consistent with your own policy and practice. If you have been paying all employees--regardless of their employment classification--for hours they would have worked had you not closed for bad weather, then you should continue to do so. If you would like to end that practice, create a clear written policy with alternative guidelines and distribute it to all employees prior to implementation.
If, on the other hand, you pay non-exempt employees only for actual hours worked, be sure to compensate them for any applicable reporting time pay. In many states, hourly employees who have arrived at work and are then sent home early as a result of lack of work, or inability to work, must be paid for a minimum portion of their scheduled shift.
For the New Jersey location referred to in the original question, hourly employees should be paid for their regular rate for no less than one hour or however long they actually worked prior to dismissal, whichever is greater (e.g., if the employee works only five minutes, you must still pay for an entire hour). Your [refers to the asker of this question's offices] locations in California, though subject to reporting time pay when employees are sent home for lack of work, will not have to pay employees for more than the time actually worked if they are sent home due to a utility outage, Act of God, or some other condition over which you, the employer, do not have control, including inclement weather.
As an alternative to having an idle workforce for a day, you could look for creative workarounds. Can employees complete their work at home? This option might save you from having to pay employees for time they haven’t worked or from reducing the number of hours they expected to work.
*Eric has extensive experience in HR, management, and training. He has held several senior HR positions, including as the HR & Operations Manager for an award-winning interactive marketing agency and as HR Director for a national law firm. Eric graduated with a Bachelor’s of Science in Economics from the University of Oregon with a minor in Business Administration. Eric is also active in the community, volunteering with the regional Human Resources Management Association Advocacy Team and with youth training programs.*
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