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Last week, the U.S. Department of Labor did more for employers than just revamp its internship test.
It re-issued a slew of opinion letters to help employers with sticky wage-and-hour issues. I’ve highlighted a few of the more notable ones below.
[Fair warning: We get kinda wonky by the end]
Can you deduct salary when an exempt employee misses work more than a full day of work? And how much?
This Opinion Letter answers three questions, among them is whether an employer can deduct salary when an exempt employee is absent for a full day for personal reasons or illness or disability but does not have enough leave time in his or her leave bank to cover the entire absence?
Let’s assume that the employer has a “bona fide plan, policy or practice of providing compensation for loss of salary occasioned by such sickness or disability.” If so, then if an employee is absent for one or more full days but does not have enough time in his or her leave bank to cover the entire absence, the employer may make a deduction from the employee’s pay for any portion of the full-day absences that is not accounted for by the leave bank. Just remember, the FLSA regulations do not permit salary deductions for partial day absences.
You can read the entire Opinion Letter, “Calculation of salary deductions and section 13(a)(1) salary basis,” here.
Year-end non-discretionary bonuses and deductions made throughout the year.
Another revived Opinion Letter addresses whether a year-end non-discretionary bonus based on a percentage of straight-time and overtime earnings from the preceding year complies with the FLSA, if the employer excludes from the calculation payments earned by the employees throughout the year which are excludable from the regular rate under section 7(e) of the Fair Labor Standards Act.
Got all that?
The short answer is yes, and no additional overtime calculations or payments must be made. The longer answer, which includes a few different scenarios, is in the Opinion Letter.
Salary deductions for full-day absences based on hours missed and section 13(a)(1) salary basis
Here the question is whether a hospital may take deductions from the salary of an exempt Registered Nurse (RN) for absences of one or more full days, but based on the number of work hours missed, without running afoul of the requirements for the FLSA professional exemption.
Here, the DOL opined that, when an employee misses an entire day of work, an employer may make deductions based upon the number of work hours missed.
You can read the full Opinion Letter here.
Employer takeaways.
Even with a more employer-friendly DOL, the Fair Labor Standards Act remains a real pain in the you-know-what. Plus, the examples above are well beyond the basics that many employers have yet to master; namely, minimum wage, overtime, and proper classification of employees (exempt v.non-exempt; employee v. independent contractor.)
Whatever you do, tread carefully and get help if you feel you need it. The last thing you need in 2018 is to defend a wage-and-hour class action.
Unless you’re outside counsel like me.