Paying Employees Properly Under the FLSA During the COVID-19 Pandemic (Coronavirus and the Law)

The Department of Labor (DOL) has issued new pandemic guidance.

These general rules on paying your employees properly also apply in most leave situations!

The coronavirus (COVID-19) has employers grappling with many serious concerns. Can I require my employees to self-quarantine? Can I take their temperature? Can I refuse to pay for time off if they travel to an infected area? Can we require teleworking?

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While there are many concerns, this article specifically addresses how to pay employees who miss time due to sickness or because the office is closed. The Department of Labor (DOL) issued guidance on the Pandemic Flu and the Fair Labor Standards Act (FLSA). As always, with any pay concerns, there may be state-specific laws (though not in Virginia) that apply.

See "Coronavirus and the Law: Workplace Response" on our legal blog for information on other legal implications of COVID-19 in the workplace.

During trying times, it is best for an employer to know what the law requires. However, please remember just because you can, doesn’t mean you should! Keep in mind the goodwill of your workforce can be a valuable asset long after this event has passed.

We have identified the requirements for compensating your exempt and non-exempt employees during the coronavirus event and urge you to consider if and when you want to deduct from your exempt employee’s salaries and consider if and when you want to pay your non-exempt employees if they are unable to come to work. This is a quick summary for your reference when you might have to restrict or close your business due to a health crisis, weather, or any other unforeseen events.

[clear] Paying Exempt Employees

The general rule is that exempt employees are paid for the full workweek when they perform any work at all during that week—even if only a few minutes! Exempt employees must be paid on a salary basis each workweek in which they work. There are very limited exceptions.

Below are possible scenarios that could occur in your workplace because of the coronavirus:

1. If the office is open, exempt employees can be at work and paid normally.
2. If the office is open and the exempt employee is out sick, including with COVID-19, then the employer can require the employee to use any accrued and unused leave benefit (sick, vacation or paid time off (PTO) for the hours missed.
3. If the office is open and the exempt employee is out sick, including with COVID-19, and the employee does not have accrued and unused time available under a leave benefit plan (sick, vacation or PTO), the employer does not have to pay the employee for a full day’s absence. Never dock an exempt employee’s partial day’s absence!
4. If the office is open and the exempt employee chooses not to come to work for fear of getting sick, then the employer may refuse to pay the employee. However, the better approach is to deduct pay for full days from any leave bank since this is a “personal decision” not based on illness. Again, pay for a partial day of work, whether with leave or not.
5. If the office is closed and the exempt employee performs no work for a full day, the employer cannot deduct the day’s absence from the employee’s salary since the employee is “ready, willing, and able to work.” The employer can require the employee to use accrued and unused leave benefits (sick, vacation, or PTO) to compensate the employee for that absence. If the employee does not have any accrued and unused PTO, then the employer still must pay the employee his/her full salary for the workweek.
6. If an exempt employee performs no work in a workweek, the employer does not have to pay the employee regardless of whether the office is open or closed.

Exempt Employees Working Remotely

 If an employer has employees working from home, they should ensure their teleworking policies are updated and revised to cover issues like COVID-19 and cybersecurity for remote workforces.

Specific to teleworking and pay, employers should be sure any expenses incurred by the employee while teleworking do not make the employee’s wages fall below minimum wage. Finally, regardless of where they work, if someone is working for you they must be paid. Use caution! If you improperly dock an exempt employee’s salary you could jeopardize the employee’s (or all similarly situated employees) exempt status.

Paying Non-exempt Employees

Non-exempt employees are paid for the time they actually perform work. Thus, whether in the office or at home, if they perform work, employers must pay them for that time. Employees who are out sick should be allowed to use sick leave or paid time off consistent with company policy.

Non-exempt Employees Working Remotely

If employers close the office to avoid the spread of COVID-19 and request any non-exempt employees work from home, adequate timekeeping methods must be in place to ensure these employees are paid properly for the time they work at home.

The coronavirus pandemic has forced employers into making complicated decisions. The Labor & Employment team stands ready to assist with any legal, business, or Human Resource decisions you might be required to make. Call on your friends at Woods Rogers and please remember to WASH YOUR HANDS for at least 20 seconds!!!

Take care and stay safe.

For more information about coronavirus and COVID-19, visit the CDC website.

https://www.cdc.gov/coronavirus/2019-ncov/summary.html

https://www.cdc.gov/coronavirus/2019-ncov/community/guidance-business-response.html

https://www.cdc.gov/coronavirus/2019-ncov/downloads/stop-the-spread-of-germs.pdf