Question: In the case of a national emergency, such as a terrorist attack that forces me to close down my restaurant, how do I handle paying my employees?
Answer: The general rule is that hourly (non-exempt) employees must be paid for half of their usual or scheduled day's work, but not less than 2 hours and not more than 4 hours. Thus, if an hourly employee shows up to work his or her scheduled shift of 3 hours but is sent home after only one, you must pay the minimum of 2 hours. If the scheduled shift is 6 hours, you must pay for half, or 3 hours. If the scheduled shift is 10 hours, you must pay the maximum of 4 hours. (However, if an employee is only scheduled to work one hour and is sent home after that one hour, he or she need only be paid for the one hour.)
An exception exists for certain events outside the employer's control, such as a closure resulting from threats to employees or property or a recommendation of civil authorities; a failure of the sewer system or of public utilities to supply electricity, water, or gas; an interruption of work caused by "an act of God"; a request by the employee to leave early for personal reasons; or where an employee reports to work unfit.
Closures due to terrorist attacks will very likely be considered as "resulting from threats to employees or property or a recommendation of civil authorities." This exception permits you to send home hourly employees and pay them only for work actually performed, without regard for the 2 hour minimum or payment for half of the hours worked.
If you have salaried (exempt) employees who are paid a monthly or annual salary, this analysis does not apply. Salaried employees are paid for the general value of their services rather than the precise amount of time spent on the job. Accordingly, exempt employees must be paid their full salaries for any week in which they perform any work (except for the weeks in which they begin and end their employment). Deducting for days not worked may jeopardize the employees' exempt status, and risk transforming them into hourly employees who must be compensated for any overtime hours worked. Therefore, for temporary shutdowns, regardless of the reasons, the employer should not deduct from exempt employees' salaries, unless the shutdown lasts for a fully workweek and the exempt employee performs no work at all during the workweek. In that case, the employer can refrain from paying the exempt employee for the entire workweek.
