07 Oct How to Discipline Salaried Employees
Over the past couple of days, I’ve worked with clients who are addressing disciplinary issues for salaried employees. There seems to be a myth that salaried employees are subject to different procedures than an hourly employee. First, I want to dispel that myth. Just because an employee is salaried, that doesn’t mean they shouldn’t be disciplined in the same way as an hourly for negative behavior.
A client approached me because a salaried employee was consistently arriving late to the office and then not staying for the expected full workday. The question was whether the company could dock the employee’s pay for not working the expected 8 hours per day. This is a great question because it incorporates how salaries work, the role of the Fair Labor Standards Act, and state law.
When a person is a salaried employee, they receive a fixed payment for their pay period, and that payment does not change regardless of the quantity or quality of the work performed. Let’s reiterate that: the salary payment does not change regardless of the quantity or quality of work.
So what does that mean? Typically the employee is measured on something other than their attendance or work produced. Usually these employees fall into some kind of professional or creative service, so they are measured in other ways than solely time or output. However, that does not mean that you cannot insist that employees be at work for a period of time. For example, if the salaried employee needs to be at the office from 10am to 4pm (let’s say those are the core business hours), but they are still expected to work 8 hours a day. You can make that expectation and use disciplinary measures when needed. However, for salaried employees, simply docking pay is not a realistic disciplinary measure.
Let’s take an example: the employer’s core work hours are 9:30am to 3:30pm. All employees are expected to be active in these 6 core hours that all employees are expected to work, regardless of whether you’re salaried or not. Hourly employees are scheduled to arrive sometimes as early as 7:30am and work to 3:30pm, while other employees may arrive at 10:30am and work until 6:30pm. But, the salaried employees are expected to be at work at minimum from 9:30am to 3:30pm. If your salaried employee is not meeting that standard, that is something that is subject to discipline. You can write someone up for it, and it could even be a fireable offense if it is bad enough.
SIDE NOTE: A related question that came from another client was whether or not a salaried employee should be expected to be paid for the day if they come to work for any part of the day. The issue was that an employee would only come in for a short period of time, and demanded to be paid for the day. Unfortunately in this circumstance, the employee is right. Even if a salaried employee is on the clock for an hour, they should be paid for the day.
Getting back to our disciplinary issue, if an employee’s behavior and failure to meet performance standards is significant enough, you can suspend them for a day or multiple days without pay. It is a perfectly legitimate method of enforcing work related rules. You would then dock their payment for the day. You do have to be very careful about this. The use of suspension without pay should be well documented and stated clearly in your existing employee manual.
There is no special treatment just because they are a salaried employee. If they are not at work, you do not have to pay them for that day. You do not need to pay them if they do not have paid time off available or if they were told not to come in because of a disciplinary issue. You can send an hourly employee home and you have to pay them for the work they did that day, but a salaried employee does get a full day’s pay. That doesn’t mean you can’t suspend an employee regardless of how they are paid.
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