Hurricane Sandy recently pummeled the Eastern Seaboard leading to thousands of business to close and many more employees off of work. In the HR world, that leads to several employment-related questions: > Do companies that close still have to pay their employees? > If a company remains open, but employees cannot make it to work, will the be forced to take a vacation day or personal day off? > If a company does close, can employee offer to work from home and still demand payment? > And what if a company closes, and employee comes to work anyway? This article reviews the main wage and hour issues involved.

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Natural Disasters and Employee Pay: What are the
Guidelines?
Hurricane Sandy recently pummeled the Eastern Seaboard leading to thousands of business
to close and many more employees off of work. In the HR world, that leads to several
employment-related questions:
 Do companies that close still have to pay their employees?
 If a company remains open, but employees cannot make it to work, will the be
forced to take a vacation day or personal day off?
 If a company does close, can employee offer to work from home and still demand
payment?
 And what if a company closes, and employee comes to work anyway?
Below is a summary of the key wage and hour issues involved:
Hourly Employees
Federal law only requires hourly employees be paid for time they actually worked. Employers
have the right to cancel work or close the business, and not pay the employee for time closed.
Exempt Employees
Employers may not reduce wages of salaried employees who are exempt from federal
overtime requirements, because of a closure. Typically, even if an exempt employee misses a
full day of work, the employer may not reduce the employee’s salary. If an employer
improperly reduces an employee’s salary based on missed time, they might lose the ability to
treat the employee as exempt and become obligated for overtime pay requirements (both
past and future).
It should be noted, that even though an employer is obligated to pay exempt employees their
full salaries, they do have the right to charge the pay against an employee’s accrued vacation
or PTO time, if available.
Telecommuting
If an hourly employee elects to work remotely from home, even if the employer did not
request that the work be performed, they must be compensated based on the same hourly
rate as if they had worked in the office.
9000 Sunset Blvd, Suite 900, West Hollywood, CA 90069
www.cpehr.com | info@cpehr.com | 800-850-7133

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Reporting to Work
Most states have their own requirements for employees who report to work when a business
is closed. They typically require a minimum number of hours be paid, but as mentioned, this
varies from state to state. While it is beyond the scope of this post to outline individual
state’s requirements, it should be noted that some reporting pay requirements may be
waived if the employer makes a good faith effort to provide employees with reasonable
advance notice that they should not to report to work. For both practical reasons and
wage/hour compliance, employers that anticipate business closures should give employees
who are scheduled to work as much notice as possible.
For additional, state-specific laws, please contact your local employment attorney.
familiar with ergonomics is highly recommended.
About CPEhr
Founded in 1982, CPEhr is a California-based Human Resources Outsourcing firm, offering
businesses an alternative for handling many HR responsibilities, including:
• Wage and hour compliance
• Safety consulting
• Workers’ Compensation Insurance
• Employment administration
• Management training
• Employee relations
• Payroll and employment tax compliance
• Comprehensive employee benefits programs.
Headquartered in Los Angeles, CPEhr has been ranked by the Los Angeles Business Journal as
one of the “Best Places To Work”, four years running. It is currently one of the largest
privately held HR Outsourcing firms in the state.
9000 Sunset Blvd, Suite 900, West Hollywood, CA 90069
www.cpehr.com | info@cpehr.com | 800-850-7133