I work for a corporation in Indiana. I want to check and make sure that they are doing something correctly and not illegal. There are 4 guys that are paid by salary. Two are engineers, one is a the shop foreman and the other is an assembly foreman. The company figured their salary by taking their normal hours of work and a per hour rate. For example, the shop foreman salary was based on 53.5 hours times $22.50 hourly rate. The company has recently done some changes where the shop foreman needs to work only 50 hours a week and has been working 50 hours a week for the last month. They are saying that since he is only working 50 hours a week, then he should only be paid for the 50 hours a week. The foreman is saying that no matter if he works 53.5 hours or 25 hours that he should still get paid the salary amount that they come up with. There was no contract or anything but just a normal company transaction. Is the company ok by saying that since you have only been working 50 hours a week, we are going to start basing your salary on 50 hours a week? Or do they have to take this person off of salary before they can do this?

Yes, it is legal, so long as the employee is properly classified as an "exempt employee". This means exemption under the Fair Labor Standards Act. There are several categories of exemption. The four basic categories are executive (under which most management personnel fall); administrative (where most senior office personnel may fall); professional (for people such as lawyers, teachers, engineers, physicians, etc.) and outside sales. The foreman may be classified as exempt as an "executive". This would mean that he regularly supervises two or more people and has the ability to hire/fire/discipline, or provide significant influence over those activities. There are several other qualifications but that is the largest.

Because of the way that the law works, a person may find him/herself in a position of earning less pay as a supervisor, on a per hour basis. This is because exempt employees are not paid by the hour but by the job. The employer can dictate that certain hours must be spent at work and can track the time of exempt employees. The only thing that an employer may not do is to dock hours from the day for most personal reasons. (Whole day docks of pay are permitted.) So, if an exempt employee has permission to go to the doctor during the day, the employer cannot dock his/her pay for that 2 or 3 hour period. On the other hand, the employer can tell the employee that he or she cannot go during work hours.

Let me know if this answers your questions. Best of luck to you.

If I could interject on this. I work for a company in Indiana as well. I haven't been there too long but have been salaried for most of my career. At other places that I have worked they never really kept track of time in or out and if we (salaried staff) worked partial days we were allowed to leave being paid for a full day and we didn't take vacation or sick. The company I currently work for requires that exempt staff take vacation sick or personal for anything, a dental appointment, going home ill, or whatever. I do work overtime and of course don't get paid, but I'm stewing about this becuase I work late with no pay and then they take vps. It's not that I leave that often, hardly ever, but what has me upset is that they are closing the office on Dec 23 at noon and forcing everyone to take 4 hours vacation. I had always been told that salaried staff do not need to take vps unless they are out for a full day. Has every place I worked been incorrect or have they just been nice (which I don't beleive that)? Or is this company just taking advantage?

Please advise. Thx

The company is not doing anything illegal. You have been fortunate at your prior employers.

If, by "salaried", you mean "exempt" (salaried is merely a pay method), if you work a portion of the day, you must be paid for the full day (unless your absence is due to intermittent FMLA leave). It is not illegal for the company to require that leave be substituted for the time missed; however, if you did not have any paid time off leave available, they would still have to pay you in this situation.

i gave my job a two week notice and i have 7 days of vacation are they suppose to pay me for those days on my last pay check.

Yes. See here:
http://www.state.tn.us/labor-wfd/lsques.html#laborlaws

Yes. See here:
http://www.state.tn.us/labor-wfd/lsques.html#laborlaws

Hello, I need to ask a question regarding a salary employee my question is an employee is a new hire and the company standard are 90 day waiting period before benefits. Do the company have to pay the salary employee for 1 hrs work or do they have to pay them for the whole day or is it at the companies descretion to pay.

please give feedback

If by salary you mean "exempt", the employee should be paid for the full day. If available leave balances exist, the employer can require the employee to use PTO for missed time. Conversely, if no available leave exists, the day should still be paid at 100%.

Please clarify, as I read the code it says unless the employee is absent more than day they have to be paid, I have never had an employer dock my PTO when I have been away for a portion of the day. How is it they can take PTO for time missed (less than a day or more) without jeopardizing exemption?

It was my understaning if they required PTO/vacation pay it could jeopardize exempt status and require them to pay overtime? Please clarify.

Thank you,

Please clarify, as I read the code it says unless the employee is absent more than day they have to be paid, I have never had an employer dock my PTO when I have been away for a portion of the day. How is it they can take PTO for time missed (less than a day or more) without jeopardizing exemption?

It was my understaning if they required PTO/vacation pay it could jeopardize exempt status and require them to pay overtime? Please clarify.

Thank you,

You've been fortunate! Employers do have the right to reduce PTO for time missed. This includes exempt employees, as well. The exception exists if there is no available PTO. Under these circumstances, if an exempt employee works a portion of a day, he/she must be paid for the entire day.

By using PTO to make up the portion of the day missed for an exempt employee, the employer is NOT putting the exempt status in jeopardy. The employer would be putting the status in joepardy if you were docked compensation for partial days missed. For example, if an exempt employee works only 4 hours and no PTO is available to cover the remainder of the day and the employer does not pay for the full day. The exempt status would be at risk. In the original argument PTO is making up the difference, this satisfies the DOL requirement.

http://www.dol.gov/esa/whd/opinion/FLSA/2005/2005_10_24_41_FLSA.htm

Are there no limits in place to protect an exempt employee from unreasonable work hours? Is it true that an employer can set a daily schedule of 8am until 10pm and if the employee is "exempt" that is allowable?

Are there no limits in place to protect an exempt employee from unreasonable work hours? Is it true that an employer can set a daily schedule of 8am until 10pm and if the employee is "exempt" that is allowable?

The DOL pretty much leaves work schedules at the discretion of the employer. What you describe is not against the law for an "exempt" employee and any other employee (with a few exceptions such as child law and a couple state specific exceptions).