Ask the Experts: Employee Pay and Inclement Weather

Question: Last week our offices were closed because of the major storm in Connecticut.  The power was out the entire work week. Do we need to pay our employees for the week?  If not, would they be eligible for unemployment compensation?

Our View:  When your business closes early or opens late or just closes for the week due to inclement weather, how you pay employees will depend on whether:  (1) they are exempt or non-exempt workers, and (2) the Company has a formal Inclement Weather Policy.   From our discussion, you mentioned that your organization does not have a formal weather policy, so we will rely on the federal and state wage and hour laws.

Your hourly, non-exempt employees can be paid only for the time they’ve actually worked.  If they have not worked the week, then no pay is due them.  If they have paid time off accrued (vacation or PTO plan), then the Company could deduct hours from the accrued “bank” to continue their pay.  If there is no time remaining in the vacation or PTO bank, then the hourly or non-exempt employee would not be paid.

If there was a day when you expected the power to be back on and asked your non-exempt employees to come to work but then had to send them home, then you would be expected to pay for the reporting time obligation.  Under Connecticut’s “reporting time” rule (Conn. Regs. 31-62-D2(2) for stores), an employer who requests an employee to report for duty must compensate the employee for a minimum of 4 hours regardless of whether any actual work ends up getting done.  Even if the employee was only at work for 30 minutes, you pay for 4 hours.  For restaurant workers, it is a minimum of two hours (Conn. Regs. 31-62-E1).  There are also additional rules in Connecticut for on-call time.

Your exempt employees are different.  Generally speaking, exempt employees get paid on a salary basis the same amount each week, regardless of the amount of work that they do.  If you have a paid time off plan (vacation or PTO), you can deduct the exempt employee’s vacation or accrued time off “bank” to make the salary whole.

Example: You send everybody home four hours into the day due to a blizzard, and the offices remain closed the next day. Joe is an hourly employee in the warehouse with no accrued paid time off and Mary is an exempt-level office manager with five days (40 hours) in her PTO bank.

Joe would receive the 4 hours of pay for the day he worked and no pay for the remainder of that day or the following full day.

Mary would receive 4 hours of regular pay for the time worked, and the Company will deduct her PTO bank for 12 hours (the 4 hours remaining on the first day and 8 hours for the next day).  Mary will receive her full pay for the week.

Regarding whether your employees would be eligible for Connecticut unemployment insurance, depending upon the circumstances your employees may be able to qualify for some assistance through the temporary layoff program offered by the unemployment department (http://www.ctdol.state.ct.us/progsupt/unemplt/shutdown.htm).  Please contact the department directly to discuss the specifics of your situation to determine benefit eligibility for your employees who missed work and compensation due to the severe weather.