Who Gets Paid When Bad Weather Shuts Down Work?

’Tis the season for winter weather, but when snow, ice and/or subzero temperatures close company doors for the day, what do you owe affected employees?

“Inclement weather and natural events can occur almost anywhere, creating hazardous conditions for employees and disrupting organizational operations,” said Alicia Scott-Wears, a compensation content director for WorldatWork. “A well-structured policy provides necessary clarity, reduces uncertainty for employees and minimizes business interruptions.”

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Weather the Storm with this Business Disruption Policy Guide

According to Scott-Wears, a proper inclement weather (and related act of nature) policy will:

Define what constitutes inclement weather broadly enough to cover foreseeable snowstorms to unforeseeable tornados, earthquakes and more.
Prioritize employee safety and their autonomy to make prudent decisions for themselves.
Clearly articulate employee segments where differing policy requirements, options or application may occur (i.e., exempt, nonexempt, remote-eligible roles, essential workers, etc.)
Outline both employer and employee responsibilities, including any impacts on pay.
Include a communication plan for inclement weather decisions.

“A thoughtful inclement weather policy not only prepares organizations for the unexpected but also reinforces a culture of trust and care,” she said.

Inclement Weather Impacts on Pay

So, who gets paid when bad weather closes the office? In the United States, per the Fair Labor Standards Act, the answer depends on whether an employee is nonexempt (hourly) or exempt (salaried). Hourly workers must be paid only for hours actually worked — that is pretty cut and dried. But exempt employees must be paid their full salary for any week they perform any work, said Keith E. Kopplin, a shareholder at Ogletree Deakins law firm.

“If an exempt employee chooses to stay home from work for a full workday because of inclement weather but the workplace remains open, the employer does not need to pay the employee for that absence,” Kopplin said. “If, however, the employer closes the workplace, or the exempt employee works a partial day before going home, or the employee works from home, the employer would need to pay for that entire day.”

In such advisement, though, WorldatWork’s Scott-Wears added a caveat. “While this is legally accurate and ensures compliance for a one-day closure, it does not account for whether minimum legal compliance aligns with an organization’s compensation philosophy and culture or the culture they are trying to create. It is also noteworthy that the incident duration and whether the opportunity to work is available can change how or when exempt employee pay may be impacted even at baseline compliance.”

Scott-Wears offered the following scenarios and related guidance regarding exempt employees:

The employer is open for operation and an exempt employee uses their own judgment to determine the conditions are not safe for them to work and are unable/unallowed to work remote and do not work for the entire day. In this case, the employer may adjust pay or require the use of paid time off (PTO) in full or partial days in accordance with the employer’s PTO policy.
The employer is open for operation and an exempt employee uses their own judgment to determine the conditions are not safe and either worked part of the day onsite before leaving or worked some of the day remote. In this case, the employer must pay the full week’s salary.
The employer is closed for less than a week and an exempt employee performs any work within the week. In this case, the employer must pay the full salary amount.
The employer is closed for a whole week and an exempt employee performs work remotely. In this case, the employer must pay the full week’s salary.
The employer is closed for the whole week and the exempt employee performs no work within that week. In this case, the employer does not have to pay that week’s salary or may require the use of PTO in accordance with the employer’s PTO policy.

Consider Additional Statutes and Precedence

State law can also impact weather policies.

“To the extent an applicable state law is more favorable for employees, employers have to follow those requirements,” Kopplin said.

For example, New York requires employers to provide certain employees with a minimum number of paid hours if they are sent home early or their schedule is changed without sufficient notice, while Minnesota allows any employee to use accrued “sick and safe” time if a family member’s school or care facility closes due to inclement weather.

Employers may also be on the hook to pay for waiting time if employees are onsite when a business is determining whether or not to close.

Also, pay attention to how you calculate overtime, stated Darlene Clabault, an editor and HR regulatory subject matter expert at compliance resource firm J. J. Keller & Associates.

In the court case Acosta v. Team Environmental LLC, the U.S. Department of Labor sued an employer for excluding payment for inclement weather days and guaranteed days from overtime calculations.

The court ruled the employer may exclude payments for inclement weather days from the regular rate but must include the payments for guaranteed days. As a result, the company paid $3.7 million in overtime back wages and liquidated damages.

What About Remote Work?

“The increased prevalence and effectiveness of remote work resulting from the pandemic has made it easier for employees and employers to get needed work done despite issues impacting the primary workplace,” Ogletree Deakins’ Kopplin said. “It can also discourage employees from taking unnecessary commuting risks during inclement weather.”

But if an employer does not want to pay wages for days that a facility is closed, casual remote work can become an issue.

Provided decisions are being made for legitimate, nondiscriminatory reasons, employers can allow certain employees to work remotely while prohibiting remote work for other employees, Kopplin said. The key is to be clear and consistent about expectations.

Generally speaking, inclement weather policies should apply equally to similarly situated employees, Clabault added.

“If two employees have the same job that can be performed at home, they should both be allowed to work from home,” she said. “Telling one employee they can work from home and be paid while denying the same to the other could risk a claim.”

Clear Communication is Crucial

Have a well-communicated policy in place before bad weather strikes, Clabault advised.

“The earlier and the clearer the communication, the better,” she said. “Bad weather doesn’t always give much warning, but inform employees as soon as possible if the company will be shut down, whether employees are expected to show up to work or not, how PTO policies are applied and how/if the employees are paid if they stay home.”

Consider sending SMS (text) notifications in addition to email alerts. Policies also should be available for viewing in employee handbooks and on the organization’s intranet.

“Retaining employees is still a challenge, so employers that provide more robust benefits, including paid time off for inclement weather, might fare better in the war for talent,” Clabault said. “Allowing employees to decide whether they can travel safely also sends a message that you care.”

Editor’s Note: Additional Content

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