Exempt Vacation Deductions

njjel

My employer asked me today - "If our administrative employees are truly salaried, why do we designate an amount of vacation they are entitled to." Good question I thought. My response was that we need to set some type of guideline for what is acceptable and that is why we have a vacation policy. However I thought that he did have a good point. This came up due to the fact that one of our salaried employees took 5 days vacation last pay period and did not have 5 days vacation time left. (She only had 4 days.) The issue was taken to the boss to decide - do we pay her or don't we......what are your thoughts please?

Nat

I assume when you say salaried that they are exempt. Technically, if this position is exempt, they are being paid to do a job and not paid based on the number of hours or days worked; however, the law does allow employers to have vacation and sick leave polices for exempt employees. Of course, these polices cannot allow an exempt employee to be docked less than eight hours. I say, if you have a vacation policy and this person exhausted their leave time then you would be O.K. to dock their pay for the eight hours. I have had attorney's advise me both ways. Whatever you do, make sure you're consistent. You might call Wage & Hour in your state and ask them. I find that they are very helpful and you call them anonymously. Good luck!

Nat

Carol CA

If the exempt employee did not work at all that week, you would be OK docking their pay for the 5th day since they only had 4 days of vacation accrued. Another option would be to pay them, but let them know they are now "in the hole" and will have to continue working until they have a positive vacation balance again. As it is only 8 hours, it's not worth making too much of a big deal over. By paying them you generate more good will and they will continue to put in those extra hours instead of feeling they are getting gyped.