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Wage and hour and payroll practices in the age of COVID-19

Mar 17, 2020

Employers nationwide are grappling with the new normal to balance how, where, and when their employees will work with the interests of employee health and safety and ever-tightening government mandates to self-quarantine.  Below are some FLSA reminders and typical issues we are fielding from clients across many industries.

READ MORE: Considering layoffs? Congress' CAREs Act could offer small business a lifeline

Some of my employees are self-quarantined and working from home.  Do I have to pay them for this work?

Employees working at home or remotely are still working and entitled to compensation for all time worked.  While not necessarily an issue with exempt employees, employers must still track and record nonexempt employees’ work time and pay them for any overtime. 

I’d like some of my employees to come in over the weekend and do a deep clean of the office.  Since this is not their regular work, and I am just asking for volunteers, I don’t have to pay them for this time, right? 

Nonexempt employees cannot be unpaid “volunteers” to assist with special duties or projects that arise while employers are working to stay ahead of COVID-19. For example, these workers should not be asked to work after hours without pay to help with a “deep cleaning” of the workplace.  Such effort constitutes work, and impacted employees should be paid for their time.

I have to immediately reduce headcount because of lost business.  When do I need to pay impacted employees?  Can I wait until the next payroll cycle?

Employers that anticipate furloughing or laying off employees should double-check their local and state laws to ensure impacted employees are timely paid. Some localities require separated employees to be paid on their final day of work.

Because we have fewer customers I cannot keep my hourly staff busy and am reducing hours.  Do I still need to pay for the 40 hours originally scheduled?

Employers need only pay hourly, nonexempt employees for the hours they actually work.  The FLSA does not require employers who are unable to provide work to non-exempt employees to pay them for hours the employees would have otherwise worked.  

I’ve got more managers than I need right now.  Can I let them off for the rest of the week but have them use vacation time?

Exempt employees may be required to take vacation or utilize their Paid Time Off or leave a bank account in the case of an office closure, provided the employees receive in payment an amount equal to their guaranteed salary.  However, exempt employees who work only a partial week on account of an office closure, and who do not have any available PTO or leave, must nevertheless be paid for the entire workweek in order to remain exempt.

I want my employees to work from home but some of them cannot because they do not have internet access to do their work. Do I still have to pay them?

Nonexempt employees need only be paid for actual hours worked. Therefore, if an employer is requiring self-quarantine, but an impacted worker cannot, or does not, perform work remotely for any reason they are not entitled to compensation.  However, if an exempt employee performs any work during a workweek they are entitled to compensation for that week at their regular salary.

If I am requiring my employees to work from home, do I need to pay for their internet access?

Likely no.  However, employers may not require employees to pay or reimburse the employer for such items that are business expenses of the employer if doing so reduces the employee’s earnings below the required minimum wage or overtime compensation.  In this instance, the employer would be required to make up the difference to ensure the employee was earning at least the minimum wage.  In addition, be sure to check local and state laws that address when employee work expenses are to be reimbursed by the employer.

With so much staff working from home, how do I track their time?

Employers’ FLSA recordkeeping requirements remain the same, regardless of whether the work is performed on-site or remotely. Accordingly, employers are advised to require their nonexempt employees who are working away from the workplace to closely and accurately record all time worked and to have employees “sign off” or otherwise approve their hours worked each pay period.  

Note that many of these issues are subject to evolving federal, state, and local regulatory guidance as the nation comes to grips with COVID-19. In addition, collective bargaining agreements may impact how some workers should be paid under certain circumstaces.               

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