Docking Pay for Salaried Employees
Aug. 19, 2015
In full disclaimer, this article is an extremely superficial overview of this topic. Wage issues are a hot and much investigated topic right now so if you have any questions about docking salaries, you really should speak to an attorney. You can also prepare yourself for that conversation by doing your own research at: http://www.twc.state.tx.us.
Generally speaking you can dock a salaried employee for a day’s or a week’s worth of salary in a few ways. Please note that you generally cannot ever dock a salaried employee for a half-day or a few hours of work. The following are a list of some ways you can properly dock a salaried employee pay:
If the employee performs no work for an entire week, you can generally dock their pay for that week. A week is the most common and intentional segment of pay for US salaried employees. If, for example, the employee would like to take a week away from work for a matter that does not fall into any medical or other benefit, an employer may permit the absence and avoid paying the employee for the full week. For example, if an employee has exhausted all vacation benefits and would like to take a weeklong racecar-driving course, you may permit them to miss the entire week without pay and still retain their salaried status.
If the employee is sick or disabled or away from work for a FMLA matter, you can avoid paying the employee salary payments for each day they were away from the jobsite for the full day. If the employee came to work for a partial day, you must pay them for the entire day. Such an employee may still be owed pay under some benefits plan.
It is permissible to dock a salaried employee’s pay for other contractually provided reasons but I caution every employer to be very careful with this concept. Also keep in mind that your salaried employee’s salary can never fall below minimum wage. Chances are, if you are exploring this option, your employee is not properly categorized as a salaried employee in the first place.
There are other times you must pay a salaried employee for the full day of work. These are salaried employees and their pay should not be based on a time calculation, generally speaking. Common mistakes are made in the following instances:
You cannot dock a salaried employee’s pay when they miss a partial day of work. You can expect them to make up the time or work but you cannot dock their pay.
You cannot dock a salaried employee’s pay for workplace misconduct or minor safety misconduct; however, you can dock employee pay in some situations for major safety violations but only in a very specific manner.