Inclement Weather & the FLSA: 3 Important Court Rulings Provide Insight

Every winter storm puts the same three questions in HR’s inbox: Are we open today? Who has to be here? And how is everyone getting paid?

Recent snow day lawsuits are a reminder to check that your inclement weather policies align with the Fair Labor Standards Act (FLSA) before a long winter of delays and closures creates avoidable wage and hour risk.

Here’s a look at three FLSA lawsuits that started with inclement weather.

1. Inclement Weather and OT Calculations

The DOL sued an employer in West Virginia, asserting it violated the FLSA by excluding payment for inclement weather days and guaranteed days from overtime calculations.

The dispute centered on whether payments for inclement weather days and guaranteed days should be included in the regular rate for overtime calculation and if they could be credited against overtime compensation.

The court ruled that payments for inclement weather days may be excluded from the regular rate, but the payments for guaranteed days must be included.

Additionally, the court rejected the employer’s request to credit these payments against overtime compensation, citing the FLSA’s limited provisions for such credits.

Spoiler: After losing the first round in court, the company decided to settle the case. It paid $3.65 million in back pay and damages to 298 affected workers.

Acosta v. Team Envtl., LLC, No. 2:16-cv-03491, 2019 U.S. Dist. LEXIS 14003 (S.D. W. Va. 1/29/19).

2. Closed on Snow Day: Salaried Manager Gets Pay Cut

A woman in Virginia sued her former employer, alleging the restaurant misclassified her as exempt from overtime pay provisions under the FLSA.

To support her claim, the woman pointed out that she was docked a day’s pay when the restaurant was closed on Jan. 23, 2016, due to inclement weather. She argued that “any improper deduction means the employer cannot meet the ‘salary basis’ requirement” for exempt employees under the FLSA.

But it wasn’t that cut-and-dry, the court said. Instead, the court had to determine whether:

• The facts showed the employer “did not intend to pay” the employee on a salary basis, and
• The employer had an “actual practice” of making improper deductions from the employee’s pay.

Here, there was no evidence that an “actual practice” of improper deductions existed, the court held. The court acknowledged that the employer “made a one-time improper deduction from one employee’s salary on one day.” But that was the only improper deduction made during the woman’s employment, the court noted.

Even though the one-time deduction was improper, that wasn’t enough to defeat the employer’s affirmative defense that the woman was an exempt employee, the court held. It granted the company’s motion for summary adjudication in this preliminary manner. The case then continued to a jury, where the worker sought more than $55,000 in damages.

Spoiler: Ultimately, the jury awarded $8,360 to the worker. A federal district court then reduced the award by 25% to account for her limited success, as the jury only awarded her about 15% of what she sought. The court also declined to award any liquidated damages, finding the company showed it had a “good faith belief that [the worker] was a manager” who was exempt under the FLSA.

Hansberger v. L’Italia Rest., LLC, No. 5:16-cv-00056, 2017 U.S. Dist. LEXIS 144887 (W.D. Va. 9/7/17).

3. Docked Pay for Snow Day? HR Director Pushes Back on Plan, Gets Fired

A former HR director at a cable company in Pennsylvania was terminated after opposing the company’s plan to dock a day’s pay from exempt employees who were absent from work due to a snowstorm. Citing the FLSA, the HR director argued against salaried employees’ pay deductions for such circumstances.

The company adopted her recommendation but fired her a few days later after she allegedly used profanity and made disparaging remarks about the company president.

The HR director filed a lawsuit that included an FLSA retaliation claim. The company said it fired her for a legitimate business reason: The HR director’s profanity and disparaging remarks caused company leaders to lose trust in her ability to fulfill her HR duties.

The HR director failed to show the proffered reason was pretextual, so the court granted the company’s motion for summary judgment and ordered the clerk to close the case.

Lesson: It’s understandable to be frustrated when other company leaders don’t understand the ins and outs of compliance, but as this case shows, it’s important to remain professional, even when it’s difficult. This whole mess – including the termination – might’ve been avoided if heated comments had been left unsaid.

Fischer v. Cable Servs. Co., No. 4:18-CV-00455, 2020 U.S. Dist. LEXIS 199136 (M.D. Pa. 10/27/20).

Best Practice for HR: Add It to the Handbook

Here’s one more way to make the most of your employee handbook: Include your inclement weather policy. That’s a good place to outline rules, expectations and standard operating procedures to ensure everyone is on the same page.

Additional items to address in an inclement weather policy include information on how the company:

• Handles full and partial business closures
• Notifies employees about weather status updates
• Views essential and non-essential roles, and
• Handles employee pay when inclement weather affects business operations.

You may also choose to address common employee questions, such as:

1. Will I be paid if the office is closed due to inclement weather?  
2. If the office is open, but I choose not to come in due to safety concerns, will I still be paid?
3. What happens if I am unable to report to work during inclement weather due to public transportation and/or children’s school closures?
4. Do I have the option to work remotely if inclement weather prevents me from commuting to the office?
5. What should I do if I lose power or Internet access while working remotely?
6. Can I use PTO if I can’t make it to the office during inclement weather?
7. How will overtime be handled if I am required to work extra hours during inclement weather?
8. Who should I contact for more info if I have concerns about my pay during periods of inclement weather?

For practical help reviewing your policies before the next round of winter closures, read our Essential Guide to the FLSA. It covers the rules that matter most and how they apply in real workplaces.