Are you considering a company closure during the holidays or for economic reasons? If so, you need to know how to pay your exempt employees without violating wage and hour law. Our employment attorney, Eric Sohlgren of Payne & Fears LLP, offers his expertise on this topic:
“In order to avoid a payment obligation to exempt employees during a business closure, the business must close down for the entire workweek. This is because the California Labor Commissioner says that employers cannot dock the wages of exempt employees (who are ready, willing and able to work) if they work a partial week and cannot work the remainder of the week due to the employer’s action in closing the business. In this case, the employer must pay exempt employees for the entire week even though they only worked a partial week. This may defeat the financial benefit of the closure.
“However, if a business is closed for a full workweek, the employer need not pay any salary to exempt employees for the workweek, providing that they do not perform any work during that week.
“Further, the Labor Commissioner has said in an opinion letter that an employer may not force an employee to take vacation or Paid Time Off if the work is unavailable due to the employer’s action. What an employer can do, however, is to give exempt employees a choice: either take no salary for the week shutdown, or at their option, they can charge vacation or PTO.”
So, in order to avoid a payment obligation to exempt employees during a business shutdown, HR Prescriptions recommends that all of the following be put in place:
- Shut down for the entire workweek.
- Instruct exempt employees in writing not to work, and take steps to make sure that they don’t. For example, you may want to close remote e-mail access or advise clients in advance that the company will be closed. You may want to designate one or two people to field client questions if necessary, but those employees would need to be paid for the entire week if they work any part of it.
- Give exempt employees the choice of taking no salary or charging PTO for the week.
Do you have any questions? Give us a call at 714-441-2422 or send us an e-mail!
First Major Civil Rights Bill of the New Century - All Employers Must Comply
What is GINA? GINA stands for the Genetic Information Nondiscrimination Act. It is a federal law that prevents employers from collecting or using an employee’s genetic information when making hiring, firing, job placement or promotion decisions. The new language is included in the body of the Federal EEOC (Equal Employment Opportunity Commission) notice. All employers with 15 or more employees must post the revised Federal EEOC notice that includes the new mandatory GINA provisions. Employment provisions in Title II of GINA will apply to the same covered entities as Title VII of the Civil Rights Act of 1964 whether or not the employer conducts genetic testing.
EEOC Updated Poster - The EEOC has published the final rule and language and it is available by clicking here. If you have ordered your State/Federal poster from HR Prescriptions in the past and want a new, updated poster, please let us know. Otherwise, using this supplemental poster is acceptable to remain in compliance.
President Obama signed into law the Fiscal Year 2010 National Defense Authorization Act (H.R. 2647). This new law includes an expansion of the recently-enacted exigency and caregiver leave provisions for military families under the Family and Medical Leave Act of 1993 (FMLA).
In January 2008, Congress amended the FMLA to provide:
These previsions are effective upon enactment. Remember that an employee is only eligible for FMLA if you have 50 or more employees and the employee works at least 1,250 hours in a 12-month period.
Sun Coast General Insurance Agency has been our client since we began in 2000. However, their Laguna Hills agency has been around since 1980 and is still going strong. Under the ownership of David Yeskin, Sun Coast is a full service general agency offering competitive (Admitted & Surplus Lines) products for the professional Independent Insurance Agent / Broker marketplace, including Automobile, Homeowners, Boats and Personal Watercraft, Ocean Marine, and Commercial Lines.
Human Resources Manager, Lori Barker, says Sun Coast’s success is based on providing a variety of insurance products and services to their clients, as well as strong customer service to both agents and insureds alike.
Beyond Customer Service, their staff would be the true key for their longevity and success - 27% of the staff has been employed with Sun Coast General 20+ years; 38% between 10 and 20 years and the remaining staff employed under 10 years. Having flexibility with their staff has resulted in loyalty, longevity and that warm “family” feeling at the end of the day.
Lori kindly added, “Sun Coast General Insurance appreciates the services of Terri Olson and HR Prescriptions for their HR guidance over the years. Even a senior, experienced company, such as ourselves, can benefit greatly from the HR regulations necessary to maintain compliance in today’s tough business environment.”
Thanks to Lori and the rest at Sun Coast...We love you guys! 
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