Answer: In regards to nonexempt (hourly) employees, an employee must be paid for any time the employee is “suffered or permitted to work” regardless of whether the work was performed in the office or at home. We recommend that you track any hour worked by the employee and pay them accordingly. The time spent not working should be handled in accordance with the employer’s leave policy.
In regards to exempt employees, if the exempt employee has accrued unused sick or paid time off benefits, the employer may deduct a partial day from any accrued unused sick or paid time off benefits (even if it leaves the employee with a negative leave balance). However, the employee must receive the full guaranteed salary, even if there is no leave in the account or if there is a negative balance.
An employer may make a deduction from an exempt employee’s salary for the employee’s full day absences due to sickness provided the deduction is made in accordance with a bona fide plan, policy, or practice of providing wage replacement benefits for such absences. Deductions may also be made for the exempt employee’s full day absences due to sickness before the employee has qualified for the plan, policy, or practice or after the employee has exhausted the leave allowance under the plan.
For example, an employer’s sick leave plan provides each employee with 10 paid sick days per year. An employee must work for the employer 90 days before becoming eligible for the sick leave benefit. In this example, a deduction of one or more full days may be made from the salary of an exempt employee who is absent due to sickness:
- Before the employee becomes eligible to participate in the sick leave plan (i.e., in the initial 90 days of employment);
- After the employee has exhausted the 10-day leave entitlement under the sick leave plan; and
- When the employee receives compensation according to the employer’s sick leave plan. (In this case, the employee would most likely not see a reduction in pay but rather the employee’s sick leave benefit would be reduced by the number of days he or she was absent due to sickness and for which compensation from the plan was received).
This information is based on federal Fair Labor Standards Act regulations. Check your state for specific pay rules relating to this issue.
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