Whether it’s an earthquake, blizzard,
bush fire or hurricane, sometimes Mother Nature unexpectedly interrupts the flow
of the work week. As government officials and disaster recovery experts
encourage workers to stay home, companies are left to determine if and how
employees will be compensated when a company or project is shut down, during and
immediately following a natural disaster.
A 2010 Fact
Sheet published by the U.S. Department of Labor’s (DOL) Wage and
Hour Division provides guidance to employers regarding compensation during
natural disasters and recovery. The guidance explains that employers are only
required to pay covered, non-exempt employees “no less than the federal minimum
wage for each hour actually worked and overtime at one and one-half
times an employee’s regular rate of pay for all hours actually worked in excess
of 40 in a week.” It further explains that “these requirements are not subject
to waiver during natural disasters and recovery efforts.” So, while some
employers choose to pay non-exempt workers for the time the company is closed,
the company is not required to do so.
The guidance also answers five additional questions that employers may face
during a natural disaster such as:
- How do employees receive their last paycheck, and how soon must they be paid
if they worked the week prior to the disaster and the employer is now
- How many hours is an employer obligated to pay an hourly-paid employee who
works a partial week because the employer’s business closed as a result of the
- Can workers receive unemployment compensation while they are out of
- If individuals volunteer services to a public agency, are they entitled to
- If individuals volunteer services to a private, not-for-profit organization,
are they entitled to compensation?
Although not listed in the guidance document, the FLSA rules are a little
different for exempt employees, those who are paid on a salary basis and meet
other tests exempting them from overtime pay. According to DOL Fact
Sheet #17G, “an exempt employee must receive the full salary for
any week in which the employee performs any work, regardless of the number of
days or hours worked,” unless no work is performed for the entire workweek.
Employers should exercise additional precautions with regard to state laws that
may require compensation for being “on-call” or being turned away after
reporting to work, among other things.
For more information on the FLSA, visit DOL’s
website. Additional information may be found on AGC’s Labor and HR Topical Resources
webpage. The primary category is “Compensation” and the secondary
category is “Fair Labor Standards Act.”