Natural Disasters & Employers’ Pay Requirements

Natural Disasters & Employers' Pay Requirements

In recent weeks, our country has been greatly affected by numerous natural disasters, including our own Employers Resource family. For employers, not only do you have to deal with the natural disaster itself, but also worry about whether you are running your small business correctly under these dire and unusual circumstances.

We want to help you eliminate these worries, so we will be bringing you a series of articles on what you need to know for various aspects of running your small business during these difficult times. For this first article in the series, we are going to explain how a natural disaster impacts your obligations regarding your employees’ pay.

Nonexempt Employees

The Fair Labor Standards Act (FLSA) only requires that employers pay employees for the actual work they perform. Therefore, if business closes due to a natural disaster, and there is no work available for a nonexempt employee, the employer is not required to pay the employee for work time missed, even if the missed time falls within their usual work schedule.

The exception to this rule is nonexempt employees who receive a set amount of pay per week, but whose hours fluctuate week-to-week. If an employee in this scenario worked any hours during the workweek in which business was closed, they are still entitled to their typical amount of pay, even if they worked significantly less hours than typical.

During these situations it is advisable that you be considerably more understanding and accepting of your employees’ ability to work or not. Even if business remains open, you may have nonexempt employees unable to safely make it into work, or must take personal time off in order to assist family and loved ones more greatly impacted by the natural disaster. While you are not required to pay these employees for time they do not work, it is still recommended that you be flexible and understanding of their safety and potential need to miss work.

Exempt Employees

Unlike nonexempt employees, exempt employees are entitled to their full salary for hours in which they were not able to work because of business closing due to a natural disaster. If business remains open during a natural disaster, but an employee decides to miss work, either due to concerns about travel or safety, then the U.S. Department of Labor considers that an absence for personal reasons.

In this situation, an employer may decide to not pay the employee for this day by placing them under leave without pay or require them to use accrued vacation or leave time for the absence.

However, it is strongly recommended that employers take great caution and care when deciding to reduce an exempt, salaried employee’s pay for reasons related to a natural disaster. Their safety should always come first, and if that is put at stake by them traveling to work, it is advisable that highly consider being more flexible with them than you might for other absences due to personal reasons.

Placing your employees in a situation where they must choose between their own safety and missing a day of pay places the employee in a tough situation that is unlikely to garner you favor as their employer.

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