Exempt ee's and part day exemptions
Yeseniayf
9 Posts
I have read conflicting information in regards to alloting sick time or vacation time to exempt employees who do not work a full schedule. Some articles say that it is O.K. to do that, others say it is not. What is your knowledge in this subject? (Our business is in California).
Comments
I do know that the only time that you can legally dock a partial day's pay on an exempt employee is when it is in relationship with FMLA leave.
I am really interested in knowing if anyone is practicing paying sick time to salary employees for partial days if they have sick time available.
Your response helps anyway.
Thank you!
The Fair Labor Standards Act basically says that in order to qualify as an "exempt" employee, he/she must meet the guidelines set forth in both the duties test and the salary test. Briefly, the salary test states that exempt employees must be paid a predetermined weekly salary regardless of the quality or quantiy of work performed.
Under the Federal regulations of the FLSA, it is permissable to charge partial day absences for exempt employees against any vacation or paid time off bank that they have. The Federal government only states that an exempt employee has to be made "whole" salary-wise. So yes, under Federal law it is okay to charge partial day absences.
However, in wage and hour instances, Federal and State law can differ. The employer is required to follow whichever law most benefits the employee. In many states, they simply follow the Federal guidelines regarding the salary basis test. Unfortunately (for most employers) and fortunately (for most employees), California has much more employee friendly labor laws than the Federal government.
California laws regard vacation pay as wages due to the employee as soon as the time has been earned, that is why California can not be a "use-it or lose-it" state in regards to vacation pay out. Employers can set a maximum amount of vacation time that employees can earn or accrue, but once employees have the time, it is considered "theirs".
Since California counts vacation time as wages to due the employee, and they also follow the salary basis for exempt employees, the states views it as contract law. The employer is required to pay all accrued vacation wages to an employee and is also required to ensure the employees receive a predetermined weekly salary (following the FLSA salary test). Therefore, you can't substitute one contractual obligation to satisfy another.
So for any day in which an exempt employee works, he/she must be paid a full day's salary. A California exempt employee need not be paid a full week's salary when he/she absents his/herself for an entire day for personal reasons, or for when no work is performed at all during the workweek (i.e. for a company shutdown).
Here are some links that might help. The first is a letter written by the California Department of Labor Standards Enforcement and the others are legal articles about the CA labor law:
[url]http://www.orrick.com/news/emplaw/IWC.pdf[/url]
[url]http://www.orrick.com/news/emplaw/020314.htm[/url]
[url]http://www.weaconsulting.com/news/show_article.asp?nlid=6&artid=28[/url]
So needless to say, charging vacation time for a partial day for an exempt employee in CA violates the law. By violating the law, the DLSE can make not only that one employee non-exempt (and subject to overtime), but also make the entire class of employees non-exempt. They can than go back 2 years to recover overtime wages, and if you don't have time records, they will go by what the employees say they worked.
Good luck! x:-)
I am really interested in knowing if anyone is practicing paying sick time to salary employees for partial days if they have sick time available. Are you familiar with this?