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WEATHERING THE STORM - EMPLOYMENT ISSUES IN THE EYE OF THE HURRICANE

9/7/2004 - “Blow, winds, and crack your cheeks. Rage, blow, you cataracts and hurricanes, spout til you have drenched our steeples . . .”.

King Lear must have had the Sunshine State in mind. In the past three weeks, the State of Florida has been hit with two powerful hurricanes that have stamped an “X” on the state, one slashing in from the west and the second crossing over from the east. The entire state has felt the effects of Charley and Frances, both of which combined to tattoo a Bull’s Eye directly on Florida. It’s been forty-four years since Central Florida has experienced a major hurricane, but Mother Nature has now amortized the weather pattern and we have had two of them in three weeks. As we write this article, Frances is lumbering up the eastern part of the country and drenching the eastern half of the United States, affecting homes, businesses and -- heaven help us -- football games. While hurricanes may be of special interest to Florida right now, we know that the Sunshine State does not have a corner on them, as folks in South and North Carolina, Virginia, Louisiana, Texas and other states can attest. We also know that storms can come in other forms, such as tornadoes, blizzards and violent thunderstorms. Sometimes, these storms cause employers to close business operations for one or more days and, when this occurs, several employment questions come to mind.

* PAYING EMPLOYEES FOR DOWNTIME

In the event of a serious storm, employers are often forced to close down operations for one or more days. Many employers wonder whether they are required to pay employees for these days and, if so, how? Here’s the answer. According to Federal Wage and Hour regulations, for non-exempt employees, there is no requirement to pay employees for time lost due to a storm. Employers are only required to pay non-exempt employees for time actually worked. On the other hand, some employers choose to pay employees for some or all of this time but, if they do so, it is a matter of company policy, not a requirement. Some employers argue that payment to non-exempt employees is good for employee morale during a difficult time and fosters employee loyalty. Others say that payment may be a good idea but the budget doesn’t allow it. Either way, it’s a matter of internal policy. Exempt employees are a different story. Except under very rare and unusual circumstances, an employer may not deduct from an exempt employee’s salary. Thus, exempt employees must be paid for storm days, as a part of their regular salary. It is permissible, however, to account one or more of these days to paid benefit time, such as vacation or PTO. Taking into consideration the employment regulations and the best principles of management, here is a policy that many employers find useful, and which you may wish to adapt to your business:

"Sheay Widget Company realizes that emergency conditions such as storms may develop which, for the safety of our employees, might require the temporary closing of the company’s facilities. Should that situation occur, a representative of the Sheay Widget Company will announce that emergency conditions exist and that the company will close. When an emergency closing occurs during the workday, full-time exempt and non-exempt employees present for work will be paid for the entire day and part-time employees present for work will be paid for the number of hours normally worked. Emergency closing during the workday will be announced to the various supervisors, who will be responsible for communicating the information to their employees. If emergency conditions develop during non-working hours, it is your responsibility to make every effort to be in contact with your supervisor during these emergency situations to determine what the work schedule may be. Non-exempt employees who are required to report to work will be paid for all hours worked. Non-exempt employees who do not report to work when required will not receive pay for this time. Employees who are not required to report to work may use accrued PTO time."

* UNEMPLOYMENT COMPENSATION

If a storm prevents an employee from working for one or more days, is that employee eligible for unemployment compensation? The answer is a bit complicated and sounds something like what the Mad Hatter might have said; nevertheless, here we go . . . unemployment compensation is a function of each individual state so you need to check the particular regulation in the state in which you live, although most regulations are very similar from state to state. In Florida, the answer is probably “no.” In order to receive unemployment compensation, a person must have been employed during a “base period” and must be willing to work. In addition, the person must exhaust a one-week waiting period, except that there is a special exception in the event of a disaster. But, there are lots of other qualifications a person must meet prior to drawing unemployment – for example, if an employee misses a day or two or work owing to the hurricane then, technically, the employee can file a claim; however, if the employee has earned more than the weekly unemployment benefit would be (currently $275 in Florida), which would likely be the case, he or she would not be able to draw. The bottom line is that, while an employee has the right to file a claim for a day or two of missed work, the odds are that he or she will not be eligible to draw, owing to the qualification requirements.

Here at Seay Management, we trust that you and your employees made it through the storm safely and with a minimum of disruption. Please call us with any questions you may have about Employment Issues in the Eye of the Hurricane, or about any other Human Resources Management issue. We’re anxious to talk with you and are very glad to be of help. In the Eye of the Hurricane, or in more peaceful times . . . “If you have an employment question, and you need an answer fast, and no one else can help, you need to call . . . The Seay Team.”



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