I work for a large national corporation which holds a contract with the federal gov't, and work on a military installation in CA. I am classified as a salaried exempt employee. However we must clock in and out and only get paid for the time worked. If only 38 hours are worked for the week we only get paid 38 hours, unless we use vacation and/or sick time to make up the difference, and any unpaid leave has to be pre-approved. Also on the rare occasions that we have to work overtime we do get paid but only straight time . It was my understating that if you were exempt and salaried you should get paid your 40 hours whether you worked more or less, unless you were absent an entire day. Is this legal?

It is possible that you are an hourly exempt employee. Examples of such employees are doctors and computer programmers. There may be a few other professions where you can be hourly exempt.

In addition, California labor law generally does not apply to work performed on military bases. You may still be entitled to overtime under Federal law, but federal law allows many types of hourly exempt employees.

I am also considered an "exempt" employee, but when I take off for an appointment the time is being deducted from my vacation/sick time. Is that legal, because I've read elsewhere that as long as I work 4 hours of that day they have to pay me for 8? Thanks.

If you work a portion of the day as an exempt employee, yes, you do need to be paid for the entire day (unless the absence is FMLA-related). However, the employer is not prohibited from substituting PTO time for work time and paying accordingly. That's what PTO is for. :)

Thanks for the response, but if that's the case, what exactly are the benefits for me of being salary? I mean, if your taking my vacation time, I won't have the time when I actually want to take a vacation. It almost sounds like they are the only one's benefiting from this.

The benefit is that if you work less than your normally scheduled hours, you still get your full salary. If you were non-exempt you don't have to be paid at all for any time you do not work, barring a couple of very limited exceptions that do not apply here.

This almost answers my longer-winded question about the same thing.

Perhaps my frustration over the crap my boss has been trying to put over on me lately is clouding my reasoning, but I fail to see the benefit.

The non-exempt employees at my company have the option of using PTO for time not worked up to 8 hours per day or docking their pay for the day. They can, in effect, 'save' their PTO for later. They also get overtime which puts their yearly earnings very, very close to mine. I used to manage some of these very same people so I know their stats.

The benefit of being salaried is that I will get paid for 40 hours of work regardless of the number of hours truly worked and any hours less than 8 per day can be automatically deducted from my accrued PTO time? I've read that if I don't have any PTO to use, they cannot dock my salary for any time not worked if I have worked [any number] of hours that week.

It seems I would be better off working 40 hours every week (no more, no less) and then demanding a payout of my 25 days of accrued PTO at the end of the year. But the company only allows for 5 days to be carried over to the next year, anything more is forfeited and they don't pay out. We also have to use those 5 days in 3 months. Is any of this legal? My research so far says it is illegal.

Assuming that you are a CA employee, then "use it or lose it" for vacation/PTO is not allowed for most employers. The rules can be found below.

http://www.dir.ca.gov/dlse/FAQ_Vacation.htm

While it is not illegal for a non-exempt employee to take time unpaid, an employer is also legally within their rights to require a non-exempt employee to use PTO to cover partial day absences. There is no law that guarantees a non-exempt employee the right to "save their PTO for later" if the employer says no.