Wage Claims Article
Allowable Deductions for Exempt Employees
Background: The Fair Labor Standards Act (the FLSA) contains rules regarding overtime, including which job positions are non-exempt versus exempt, and it dictates that employees in non-exempt job positions receive overtime pay. In contrast, the FLSA does not require employers to pay overtime to employees in exempt job positions regardless of how many hours they work. The FLSA lists factors that indicate whether a job should be treated as exempt from overtime or as non-exempt (which require overtime pay for extended work hours). This article is written for exempt employees and more particularly this article focuses on the circumstances that would permit your employer to reduce (“dock”) your compensation when you miss work.The Basic Rule: The starting point is that an exempt employee’s salary in any week in which he or she performs any work duties at all cannot be reduced by the time not worked so long as the employee was ready, willing and able to work. For example, if you, an exempt employee, are ready to work but inclement weather shuts down roads and shutters your building for some portion of your workweek, you must be paid your full week’s salary. The basic rule is that if you worked any part of a week and are kept from work for some portion of it through no fault of your own, then you must be paid as if you had worked the full week.
Exceptions to the Basic Rule: The old platitude that rules are meant to be broken holds true here. There are seven rule breakers that allow your employer to reduce your (an exempt employee’s) weekly salary.
- If you, an exempt employee, are absent from work for one or more full days for personal reasons (other than sickness or disability, which are addressed below), your salary that week may be reduced in full day increments. If you work any part of a day, you must be paid for the full day.
- If you are absent from work for one or more full days due to sickness or disability, your salary for the week in which those absences fell may be reduced but only if the company provides wage replacement benefits for these types of absences under a bona fide plan, policy or practice.
- In weeks where you take unpaid leave pursuant to the Family Medical Leave Act, your compensation will be reduced pursuant to the FMLA policy in place for all employees, which may mean your salary could be reduced in less than full day increments.
- If you miss work to report for jury duty, to serve as a witness or to perform military service, your weekly salary may be reduced by the amount of any payment you received from your service.
- Your weekly salary may be reduced by the amount of any penalty imposed in good faith against you for violating safety rules of major significance.
- If you have an unpaid suspension imposed in good faith against you for violations of written workplace conduct rules, your weekly salary may be reduced in line with the duration of the suspension.
- If your first and final week of work are not full weeks, your compensation may be reduced accordingly.
As a reminder, the above exceptions are for absences other than those lasting a full workweek. The law does not require employers to pay exempt employees for full-week absences.
Who To Turn To For Help: The FLSA rules limiting the circumstances in which an exempt employee’s salary may be reduced due to an absence are fairly complex. Inadvertent errors are certain to occur. If you think that your salary may have been docked where the law precludes it, you may want to talk with an attorney knowledgeable about wage and hour laws. Another option available to you if you have questions about the wage and hour laws and your rights under those laws is to call the Wage and Hour Division of the Department of Labor. The telephone number for the DOL office in Arizona is 1-602-514-7100, or call the agency’s toll-free help line at 1-866-487-9243.
Contributing Attorney Writer: Shirley Kaufman is an attorney at Faulkner Law Offices, PLLC where she focuses on employment law.
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QUESTIONS
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I am a seasonal employee, who earns a salary. My work only takes up 10 months of the year, but the salary is deferred, and distrulibuted over the two months when there is no work to be done. Because of COVID, my employer wss forced to shut down with 8 weeks of work remaining. How can I recover the wages I earned, which were deferred, since it exceeds the labor boards maximum for wage claims?
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I worked for an AC company and during that time of my employment my AC needed service. They fixed it at a discount price and we agreed that I would make weekly payment until the balance is paid. Well I was terminated before being able to pay off the balance. My question is can they withhold that from my final paycheck? Also they're charging me for a price book that I dont have and some uniforms that were missing but I turned in whatever uniforms I had. Can they withhold that as well?
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I work in outside sales. For a number of years my employer has deducted shipping costs from my commission for all accounts outside the metro area. Recently they have begun deducting the % of $ credit charges cost from my commission as well. They deduct this before my paycheck is cut. For example they show me a spreadsheet with my compensation as $7000.00 -500 shipping -500 cc fees (and sometimes other deductions) = $6000.00 since these fees are deducted can i write them off on taxes and is this even legal?
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My employer provides hand written payroll checks every 2 weeks, however has never provided me with a paystub. In reading statutes, I was only able to find specific language regarding wage statements being required for electronic deposits. Annual statements are provided, however I have found discrepancies on these statements (amounts not matching checks received, pay dates missing from statements, pay dates listed on statement that weren't actually pay dates, incorrect taxes withheld). I have requested regular pay stubs, but they will not provide them. What can I do?
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My paycheck bounced and when I inquired about it, I was terminated. I am now owed payment for 150 + hours. What are my options?
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My employer makes us waitresses pay three dollars per day in cash to him for a portion of the carpet cleaning he pays for. Is that legal?
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is it legal for my boss to deduct my pay due to mistakes made by his employees on jobs we recently have been doing, and has he broke the law and which law?
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