Considerations for Employers During Natural Disasters

With the impending landfall of Hurricane Florence (and the great potential for others to follow), HR Workplace Services is re-distributing an HR Clinic that outlines important employer considerations should an immediate, natural disaster occur.

Employee Wages

It can be a concern as to how an employer should address employee wages in such a unexpected circumstance. If a company is forced to cease operations for a significant period of time, it could face financial issues. Employers may also feel concerned for their employees, as some have experienced varying degrees of personal losses.

So, what are employers required to do in terms of wage or salary payments? The answer is – it depends. Employers must examine the facts and circumstances causing the employee to miss work.

The (Federal) Fair Labor Standards Act (FLSA) is the law that governs employer requirements in terms of wages and work hours. A natural disaster does give employers a waiver from the requirements of the FLSA. However, the FLSA will guide employers on what is required (based on an employee’s exempt or non-exempt classification).

Non-exempt employees, under the FLSA, are required to be paid for hours actually worked. Therefore, if an employer is unable to provide a non-exempt employee with work due to a natural disaster, the employee, by law, does not need to be paid. Though, if nonexempt employees do any work remotely (from home or elsewhere) when the company is officially closed, they must be paid for the hours worked. There is, however, an exception to the above, if an employer has an employee who is classified as non-exempt but who is paid a fixed salary for fluctuating workweeks. In this case, if the employee does any work during the week, the employee must be paid their salary.

There are different requirements for exempt employees under the FLSA. When the exempt employee performs any work during a week, he or she must be paid their full salary regardless of the number of days or hours actually worked. However, if the exempt employee does no work and the company closes for a full week, exempt employees (under FLSA) need not be paid for any week in which they perform no work. In fact, not paying exempt employees holds true whether the employee is able and willing to work or not, when the workplace is closed for a full week and the employee performs no work. Deductions may not be made for times when work is not available. In other words, if the company closes operations for a day or two (yet the employee is able and willing to work),they must be paid. The opposite would be true if the company were to close for a couple of days but the employee is not able or willing to work. In that instance, if the exempt employee is absent for one or more full days dictated by personal reasons, deductions may be made. Employers should always remember that if an exempt employee performs any work in a day, even answering one email or call (something that may seem rather insignificant), they must be paid their full salary.

If a company has employees covered under a collective bargaining agreement (CBA), it is important to review the CBA in order to determine if there are provisions requiring employees to be paid (even if the company is not required to pay under the FLSA).

Employees That Are Called to Duty

In the aftermath of a natural disaster, employees who are National Guard members or volunteer emergency responders may be called to assist in recover and rescue efforts. Under federal law, the Uniformed Services Employment & Reemployment Rights Act of 1994 (USERRA), employers have an obligation to accommodate employees who must take a leave of absence to fulfill their uniformed services. USERRA’s definition of “uniformed service” is broad and covers many types, both voluntary and involuntary.

Though employers are not required to pay those who take leave under USERRA (unless the company has a CBA or policy stating otherwise), they are required to allow the employee to take leave.

Employers should familiarize themselves with USERRA. The Department of Labor (DOL) has created a fact sheet that outlines its provisions of the law and can be found at: https://www.dol.gov/vets/programs/userra/userra_fs.htm

Additionally, many state laws provide leave provisions for employees who also serve as volunteer emergency responders. Employers should determine if there are state laws that govern their particular instances of required leave.

Family and Medical Leave

Under federal law, employees may be eligible for a leave of absence to care for their own serious health condition or that of a family member. Therefore, if an employee or their family member is injured during a natural disaster, the employer must comply with provisions set by the Family and Medical Leave Act (FMLA). There are also state family and medical leave laws which can be enforced, so employers must ensure compliance with those as well.

Unemployment Considerations

It is possible that employees who are unable to work because of a natural disaster may qualify to receive unemployment insurance benefits. Typically, if the employee has earned the appropriate level of wages during their “base period,” they would qualify. The definition of base period varies by state.

Health Benefit Continuation

There may be provisions within a company’s health benefit plan documents that require employees to actively be at work in order to be covered under the health plan. Once the outlined plan document period expires, an employee’s coverage would terminate and COBRA notices required to be sent. Self-insured plans and carriers may waive this provision.

Assisting Employees Affected by a Natural Disaster

Most opportunities helping natural-disaster affected employees are done at the employer’s discretion. Programs (such as leave donation or charitable trust set-up) are options an employer may wish to consider. In any case, such programs should be properly set up and administered (including tax implications).

A natural disaster can create a variety of issues for both employers and employees. Everyone must work together, as business and lives are rebuilt through recovery efforts.

For more information, start a conversation with us.