Exempt Use of Vacation, Personal Days
dwf
22 Posts
I've read most of the postings in this category and understand that exempt employees shouldn't be docking themselves for time out of the office of less than a day. But is it a violation of FLSA if exempt employees use vacation and personal days in 1/2 day increments instead of whole days?
Comments
According to the FLSA "DOL Wage and Hour Opinion Letters consistently have ruled that deductions from leave banks are permissible. A letter dated July 17, 1987 states that: "An employer can require an employee to substitute paid leave for absences of less than a day without losing the exemption for the week." This was used in a ruling by the 4th Cir. Court. The DOL reiterated its decision in letters dated 4/9/93 and 4/15/94.
However the 9th Cir. stated "in fact, a strong argument can be made that even if deductions were required only from fringe benefits such as leave time, and not from base pay, the affected employees would still not qualify as 'salaried'." Then proceded to turn around and reverse its position.
In closing, my FLSA Employee Exemption Handbook states it is clear that the DOL, through its Wage and Hour Opinion Letters, believes that reductions in leave accounts in increments of less than a day are permissible under the salary basis test. It further states that employers who choose to make deductions from exempt employees' leave banks by the hour, however, should establish clear policies regarding how they will deal with employees who have no leave bank, or negative leave bank, balances. Any such policy should make clear that while a reduction in leave by the hour may be acceptable, an employee will not suffer deductions in pay for anything less than a full day.
How can employers know what to do when the courts can't even make up their mind??? How does everyone else handle this??? Some of our board members want the deductions made. I believe that our exempt staff puts in so many extra hours they should be entitled to this "perk"(?).
Our general manager also looks at total hours put in during the span of a year, and (right or wrong) I know he takes all extra hours (over 40 per week) put in into account when he gives out bonuses, in addition to quality of work produced etc. It seems to obviously be contradictory to FLSA rules, because salaried/exempt ee's should be able to do whatever it takes to do their job well, regardless of how many/little hours they put it, as long as the job is done well...... but anyway he does do it.
memiller: I wouldn't see a problem with the practise you use because you would be looking at absenteeism in general, rather than how many hours they put into doing their jobs (as my general manager is doing...)
The danger we run in this type of program is that theoretically someone could complain that the reason they ran out of leave was because they took the partial days. If they hadn't taken the partial days, they would have had more leave remaining. It hasn't been an issue.....yet!