Do you pay employees during an emergency closure? When bad weather or a natural disaster occurs, a business can be forced to close down for a time. The closure might be caused by weather conditions like snow, heavy rain, hurricane, tornado, flooding, or sleet. The closure could also occur due to a natural disaster or other factor such as earthquake, explosion, fire, utility outage, or terrorist attack. Are you required to pay your employees during that time? The answer is “yes”, “no”, and “sometimes”.
NO- You do not have to pay hourly employees when the business is closed down due to an extended emergency, especially if you have a written policy stating that you do NOT pay during closures due to inclement weather or natural disaster. Consider purchasing a professionally done Employee Handbook, which will cover this policy along with many others. We recommend New Wind Business Solutions:
SOMETIMES- Some states do insist on Reporting-to-Duty pay that says you must pay any employee who shows up to work as scheduled even if there is no work available. So even if the business is closed, if they make it to the worksite, you have to pay. So if your business must close, especially for more than a day, have your employees’ numbers available to call so that you can revise their schedules as needed. The rules differ by state on Reporting-to-Duty Pay, but they usually require a half-day’s pay: 2 hrs minimum, 4 hrs maximum. See your particular state’s website for details.
YES- Salaried exempt employees must be paid if they work anytime during a workweek and are available to work the remaining days, whether they actually work or not. You cannot cut an exempt employees pay just because you cannot get your full 40 hours out of them this week, just like you do not have to pay them OT during those busy weeks when they work more than 40 hrs. Be sure you have your employees correctly classified. Some businesses think they can classify anyone as Exempt, but that is not true. Generally, these jobs demand an advanced degree, pay in commissions, or are an executive position. The usual employees who can be exempt are:
1. Upper Management
2. Certain Other Management
3. Certain Creative Professionals
4. Certain Advanced-degree Professionals
5. Certain High-Paid Technical Employees
6. Certain Highly Commissioned Sales People
Once again, this is an area where a good Employee Handbook can help. Set up your employee policies for OT, Exempt Employee Deductions, Inclement Weather, Natural Disaster, and Report to Duty Pay. Consider a professionally designed Employee Handbook, customized to your business: