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Feb22

PTO for Part-Timers in the State of Virginia

What is the labor law for PTO for part-timers in the State of Virginia?

There is neither federal nor Virginia State law requiring private employers to provide paid time off (PTO) benefits to employees. Per the Virginia Department of Labor & Industry, “Fringe benefits such as vacation, sick, holiday, and severance pay are not required to be given under the law, and employers may establish any or no policy regarding these fringe benefits.” Thus, employers are generally free to adopt PTO policies of their choosing including whether or not such policies apply to part-time employees.

February 22nd, 2017, 2:14 PM |  Posted in: Benefits |
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Feb22

Tracking Exempt Employees’ Hours

Can you tell me if I need to track exempt employees’ time in the following states: IL, PA, CA, OH, GA, Washington State, NJ, NY, CT?

The federal Fair Labor Standards Act (FLSA) establishes minimum wage, overtime pay, recordkeeping, and youth employment standards affecting employees in the private sector and in Federal, State, and local governments.

Under the FLSA, employers are required to keep track of certain records for non-exempt employees including hours worked each day and hours worked each workweek. Though employers are permitted to record and track hours worked by exempt employees, there is no requirement to do so. However, some states have adopted their own wage and hours laws that require more recordkeeping than the federal law including some of the states you inquired about.

We couldn’t locate any laws requiring the tracking of exempt employees’ hours worked in PA, CA, OH, GA, WA, NJ. Such laws exist in IL and CT.

Section 300.63 of Illinois Labor Code expressly requires the tracking of exempt employees’ hours worked:

“Regardless of an employee’s status as either an exempt administrative employee, executive or professional, every employer shall make and maintain, for a period of not less than 3 years, the following true and accurate records for each employee: the name and address, the hours worked each day in each work week, the rate of pay, copies of all notices provided to the employee as required by subsection (d), the amount paid each pay period and all deductions made from wages or final compensation. Additionally, any employer that provides paid vacation to its employees must maintain, for a period of not less than 3 years, true and accurate records of the number of vacation days earned for each year and the dates on which vacation days were taken and paid.”

Under Section 31-60-12 of Connecticut’s Administrative Regulations, employers are required to maintain certain records for each employee including:

 (1) His name;
(2) his home address;
(3) the occupation in which he is employed;
(4) the total daily and total weekly hours worked, showing the beginning and ending time of each work period, computed to the nearest unit of 15 minutes;
(5) his total hourly, daily or weekly basic wage;
(6) his overtime wage as a separate item from his basic wage;
(7) additions to or deductions from his wages each pay period;
(8) his total wages paid each pay period;
(9) such other records as are stipulated in accordance with sections 31-60-1 through 31-60-16;
(10) working certificates for minor employees (sixteen to eighteen years).

 

Connecticut’s regulation doesn’t specifically state both non-exempt and exempt employees, but it doesn’t exclude exempt employees either. Thus, it may be best to err on side of caution. Otherwise, consider contacting the local DOL.

It’s worth noting that even though tracking exempt employees’ hours worked is permitted and sometimes required, deducting from exempt employees’ salaries is only allowed in limited circumstances under the FLSA and some state laws.

HTH!

February 22nd, 2017, 1:58 PM |  Posted in: Human Resources Management |
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Feb22

Church Musician and Salary

Is a church musician who gets a set amount for playing the organ each week considered a salaried worker. What if he does not work one Sunday, do we still have to pay him?

The federal Fair Labor Standards Act (FLSA) establishes minimum wage, overtime pay, recordkeeping, and youth employment standards affecting employees in the private sector and in Federal, State, and local governments.

There are two ways an employee can be covered under the FLSA, enterprise coverage and individual coverage.

The DOL has opined that enterprise coverage does not apply to a private, non-profit enterprise where the eleemosynary, religious or educational activities of the non-profit enterprise are not in substantial competition with other businesses, unless it is operated in conjunction with a hospital, a residential care facility, a school or a commercial enterprise operated for a business purpose.

Employees of enterprises not covered under the FLSA may still be individually covered by the FLSA in any workweek in which they are engaged in interstate commerce, the production of goods for commerce or activities closely related and directly essential to the production of goods for commerce. Examples of such interstate commerce activities include making/receiving interstate telephone calls, shipping materials to another state and transporting persons or property to another state.

If the employee is not covered under the FLSA, compensation is a matter of agreement between you and the employee. If there is any doubt to the employee’s exemption from the FLSA, it’s best to either contact your local DOL or comply with the FLSA as if the employee is covered.

Let’s assume the employee is covered under the FLSA.

Under the FLSA, employees are classified as either non-exempt or exempt.

Hourly and salary paid are compensation terms.

Non-exempt employees must be paid for all hours worked and are subject to overtime and minimum wage requirements prescribed by the FLSA. Most employees are considered non-exempt.

Conversely, exempt employees receive a fixed predetermined salary for any week during which work is performed regardless of the quantity or quality of such work. Exempt employees are excluded from overtime pay provisions.

It’s up to employers to determine an employee’s classification based on FLSA guidelines.

To be exempt, an employee must pass all three “tests”, salary level, salary basis, and duties, as outlined by the FLSA.

The salary level test: Employees who are paid less than $455 per week are non-exempt. It’s worth noting that the federal Department of Labor’s new overtime rule that increased the salary level to $913 per week as of December 1, 2016 has been blocked. The new rule could still be implemented in the future but as of now it’s on hold.

The salary basis test: An exempt employee must receive a regular, predetermined amount of compensation each pay period on a weekly, or less frequent, basis. Aside from a few exceptions, an employee must receive the full salary for any workweek during which the employee performs any work, regardless of the number of days or hours worked.

The duties test: An employee who meets the salary level and salary basis tests is exempt only if he/she also performs exempt job duties. The actual tasks of the job are to be evaluated, not the job title. Exempt employees are employed as bona fide executive, administrative, professional and outside sales employees.

Job duties are exempt “executive” job duties if the employee regularly supervises two or more other employees, has management as the primary duty of the position, and has some genuine input into the job status of other employees (such as hiring, firing, promotions, or assignments).

“Professionally” exempt work is predominantly intellectual, requires specialized education, and involves the exercise of discretion and judgment. Advanced degrees are the most common measure of this but are not absolutely necessary if an employee has attained a similar level of advanced education through other means and performs essentially the same kind of work as similar employees who do have advanced degrees.

Further, the creative professional employee exemption applies to an employee whose primary duty is the performance of work requiring invention, imagination, originality or talent in a recognized field of artistic or creative endeavor, like musicans.

“Administratively” exempt employees provide support to the operational or production employees and have a major impact on the overall business. An administratively exempt employee has the authority to create or interpret company policies, has responsibilities that directly relate to the overall business operation, has the decision making ability to make significant financial impacts, and has the authority to deviate from company policy without prior approval.

An employee who doesn’t pass all three tests is considered non-exempt under the FLSA.

A musician may be considered exempt under the creative professional exemption as long as he meets all the other criteria. Otherwise, he’s non-exempt.

It’s worth noting that it’s always safer to classify an employee as non-exempt. This way you ensure the employee is being paid for every hour worked and you don’t risk violating the FLSA.

As a non-exempt employee, the musician need only be paid for time worked. So, if he didn’t work a Sunday there would be no requirement to compensate him for the day.

Now, a non-exempt employee can still be paid a salary. The employee is just treated as non-exempt as prescribed under the FLSA but receives a set salary each week based on a predetermined number of hours. If a non-exempt salaried employee works beyond his set hours then he must be compensated for the time worked. And, if he works below the set hours his salary can be reduced as appropriate. But, this can become an administrative headache if the employee’s hours will fluctuate each week.

HTH!

February 22nd, 2017, 11:17 AM |  Posted in: Compensation, Labor Laws |
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Feb22

PTO prior to Annual Hire Date

Hi! First, thank you for this resource. I am a volunteer President of a Condo Association. We have 3 employees. We find it a bit harsh that they cannot get any PTO until after working a full year. Is there a standard about how to pay some PTO prior to the anniversary date of their being hired?

Paid time off (PTO) is considered a matter of agreement between employers and employees. Thus, employers are generally free to adopt PTO policies of their choosing, in accordance with applicable state/municipality laws and/or employment contracts.

Requiring employees to wait a full year until using their PTO is fairly common, 6-12 months is the norm. If you find your policy a bit extreme for employees, consider lowering the waiting period to 6 months.

If for some reason the policy can’t be changed, then allowing an employee to use his PTO prior to actually being entitled to it is at the employer’s discretion. The employee would have a negative PTO balance and the PTO bank would be replenished when the employee meets the eligibility requirement. But, by doing this you’re just negating your own policy. What’s the point of a policy if you’re not going to adhere to it? Plus, you’re setting a practice of disregarding your own policies.

You may consider allowing employees to take unpaid time off prior to their anniversary date. Since the time is unpaid, you’re not going against your PTO policy and employees still have the opportunity to take time off if need be.

Glad you like our blog! HTH!

February 22nd, 2017, 10:49 AM |  Posted in: Benefits |
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Feb22

Vacation Pay

If an employee quits their job while on vacation and gives no notice are we required to pay that vacation?

The federal Fair Labor Standards Act (FLSA) establishes compensation regulations.

Non-exempt employees must be paid for each hour worked. There is no requirement to pay a non-exempt employee for time not actually worked, like vacation.

On the other hand, exempt employees must receive their full salary for any workweek during which work is performed. There are limited exceptions to this rule.

Let’s say an employee is taking a weeklong vacation and on the last day of his vacation he calls you to resign with no notice period. In this case, neither a non-exempt nor an exempt employee would be required to be compensated for the week since no work was performed during the workweek.

However, let’s say the employee worked a few days during the workweek and took the remaining days as vacation. He then calls you on his last day of vacation to resign with no notice period. In this case, the non-exempt employee need not be compensated his vacation time. But, the exempt employee must still receive his full salary for the workweek since he worked earlier in the week.

Paid time off benefits, like vacation pay are not regulated by federal law. Some states have adopted regulations on the matter. Most states simply require employers to comply with their own policies or established practices, while other states consider vacation time to be earned wages. So, it’s important to know any applicable laws in your state.

Absent state law or employment contract, employers are generally free to adopt vacation policies of their choosing. So, an employer may implement a policy stating that an employee’s last day worked is their termination date. Meaning, an employee who doesn’t return from vacation isn’t entitled to vacation pay. Further, it’s fairly common to include a stipulation in vacation policies that employees who don’t provide sufficient resignation notice will not be entitled to receive unused accrued vacation pay upon separation.

February 22nd, 2017, 10:29 AM |  Posted in: Benefits, Compensation |
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