mandatory unpaid leave - exempt or non?

boslaw

I have a question about forced unpaid leave. First the facts.

Employee works from home in Mass.

Company is based in Calif.

Employee is a regional project manager for clinical research organization.

Employee is paid hourly, but company pays for minimum 40 hours per week, even if there's not enough work to cover. Anything over 40 hours is paid at full hourly rate. Company considers her "exempt" employee.

Employee recently returned from maternity leave and was told that there's not much work for her. Company moved her onto one short term (less than two weeks) project that required travel (her regular position required travel only once or twice per year).

Company recently left voice mail for Employee stating that "since Employee is refusing assignments, Company will put Employee on unpaid leave". Employee never refused assignments, and in fact agreed in advance to any available assignments.

Is this legal? Is the Employee truly an exempt employee, given the facts above? Would the employee typically be entitled to overtime pay for work in excess of 40 hours, given the above facts?

Theresa Gegen TX

I think an employment attorney that represents employees would see this as a possible case of FMLA retaliation or pregnancy discrimination.

You should suggest that your friend talk to an employment attorney in your state.

Good Luck!

boslaw

Thanks. I also found out that in Massachusetts, if your company tells you that they have no work for you, and as long as you don't work any hours during the week, you can collect unemployment while you are still employed by the company. This would be good for many employees in this type of situation.

Shadowfax

I don't thnk you've given us enough info about what the em/ee actually does to determine if she is truly exempt or not. It seems to me the real question is whether or not if she is exempt, are you destroying the exemt status by the way you are paying her. Possibly. And if so, the payment of over 40 at full hourly rate is obviously a problem. To answer your first queston, yes, the em/r can put even exempts on forced unpaid leave for absences occasioned by the employer or the operating requirements of the business..such as..when work is not available. 541.118(a)(1) But, the unpaid leave must be for at least full weekly period because em/er must pay for full week any week in which work is performed. I also agree with Theresa that when you add in the fmla and the pregnancy issues, it complicates thnings enough to work through these issues very cautiously.

boslaw

Thanks very much for the response.

The employee is a regional project manager for a clinical research organization. She manages major projects, which encompasses some management of lower level employees.

During active projects, Employee typically works in excess of 40 hours per week (55-60 hours on average), of which a majority is billable to clients.

Company has repeatedly offered to switch Employee to salary, but Employee rightfully understands that salaried would be less advantageous for her (salary offering is approximately $75,000, while average annual earnings over last for years has been approximately $105,000).

I am an attorney, but I am primarily experienced with intellectual property contracts issues. I'm not familiar with most of the employment rules, regs and laws. I've been researching the laws, but real world experience and knowledge provided on this board is a major help.

Hatchetman

She can't be paid hourly if she's exempt unless she's a physician, a LAWYER, or a school teacher practicing in the particular profession. (Computer professionals systme deisigners, analyst, etc, can also be that way.) And it doens't sound like she's anyone of these.

Since they are paying her salary that covers the regular work week without docking pay for absences, then there is no problem if they call it hourly -- except it may raise the question of exactly what she is (exempt or non-exempt) if DOL ever comes aknockin' for an audit or investigation.

And under US DOL, an emplyer may be "overtime" to an exempt emplyee in any manner it wants as long as it has not improperly docked the weeks salary.

The exeption to docking pay for partial days' absences of an exempt employee who is not a physician, lawyer or school teacher, is partial days' absences under FMLA and public sector employees who are exempt.


There are two basic resources in aditio to what information HR Hero has that may provide additional information.

The US Department of Labor Website has an eLaws adviosry page for FLSA (it's interactive)[url]www.dol.gov[/url] Click on the eLaws Advisor link.

Or the second one are the FLSA regulations themselves which are for the most part pretty straight forward but sometimes seem to be disjointed. But you're a lawyer, so you can muddle through them (after all, they were written by attorneys)

[url]http://www.access.gpo.gov/nara/cfr/waisidx_02/29cfr541_02.html[/url]


If the leave was under FMLA, you US DOL also has an interactive eLaw for that at the same siie as for FLSA.

And the link to the FMLA regulations is

[url]http://www.access.gpo.gov/nara/cfr/waisidx_02/29cfr825_02.html[/url]


Of course, Massachussetts may have additional provisions for exempts. As you know, the emplyee gets the benefit of the more liberal provision if there is a conflicting difference.

boslaw

Thanks. I appreciate the in depth reply. There are definitely a number of issues to work through, and they all seem to fall into a bit of a grey area.