Wage and Hour Division (WHD)
Opinion Letters - Fair Labor Standards Act
March 2, 2009
Enclosed is the response to your request for an opinion letter signed by the then Acting Wage and Hour Administrator Alexander J. Passantino on January 16, 2009 and designated as Wage and Hour Opinion Letter FLSA2009-25. It does not appear that this response was placed in the mail for delivery to you after it was signed. In any event, we have decided to withdraw it for further consideration by the Wage and Hour Division. We will provide a further response in the near future.
The enclosed opinion letter, and this withdrawal, are issued as official rulings of the Wage and Hour Division for purposes of the Portal-to-Portal Act, 29 U.S.C. § 259. See 29 C.F.R. §§ 790.17(d), 790.19; Hultgren v. County of Lancaster, Nebraska, 913 F.2d 498, 507 (8th Cir. 1990). Wage and Hour Opinion Letter FLSA2009-25 is withdrawn and may not be relied upon as a statement of agency policy.
John L. McKeon
Deputy Administrator for Enforcement
This Opinion Letter is withdrawn.
January 16, 2009
This is in response to your letter requesting an opinion regarding whether a hospital may take deductions from the salary of an exempt Registered Nurse (RN) for absences of one or more full days, but based on the number of work hours missed, without running afoul of the requirements for the professional exemption under section 13(a)(1) of the Fair Labor Standards Act. It is our opinion that when an employee misses an entire day of work, an employer may make deductions based upon the number of work hours missed.
Your client employs an RN who is paid a salary to be on call and available for surgery from 2:30 p.m. on Friday to 6:30 a.m. on Monday. The RN is not paid extra compensation when she is called to the hospital for surgery. She is given one weekend of paid time off every three months. You ask us to assume that the RN otherwise meets all the requirements of the Part 541 exemption for learned professionals. Additionally, you have stated that the RN is paid a salary in excess of $455 a week. The hospital would like to know the proper method for making a deduction from the RN’s salary when the RN is not available to be called for all hours either on a Friday, Saturday, or Sunday. The hospital is aware that it may require the RN to use paid vacation or sick leave for the time missed. Your question is limited to occasions where the RN is unavailable for call for a full day rather than a portion of the day.
In order to qualify for the section 13(a)(1) exemption, employees must be paid on a “salary basis.” For a plan to qualify as payment on a salary basis, the employee’s predetermined salary amount must not be subject to reduction because of variations in the quality or quantity of the work performed. 29 C.F.R. § 541.602(a). Exempt salaried employees must receive their full salary for every week in which they perform any work, regardless of the number of days or hours they work. 29 C.F.R. § 541.602(b), however, provides several permissible deductions from an exempt employee’s salary, including in relevant part:
(1) Deductions from pay may be made when an exempt employee is absent from work for one or more full days for personal reasons, other than sickness or disability.
(2) Deductions from pay may be made for absences of one or more full days occasioned by sickness or disability (including work-related accidents) if the deduction is made in accordance with a bona fide plan, policy or practice of providing compensation for loss of salary occasioned by such sickness or disability.
* * *
(5) Deductions from pay of exempt employees may be made for unpaid disciplinary suspensions of one or more full days imposed in good faith for infractions of workplace conduct rules.
29 C.F.R. § 541.602(b)(1) - (2), (5). Therefore, deductions from an exempt salaried employee’s salary may only be made on a full-day basis. As explained in the preamble discussion of this section of the current rule, “[w]e believe that partial day deductions generally are inconsistent with the salary basis requirement, and should continue to be permitted only for infractions of safety rules of major significance, for leave under the Family and Medical Leave Act, or in the first and last weeks of employment.” 69 Fed. Reg. at 22,178. As provided in 29 C.F.R. § 541.602(c),
[w]hen calculating the amount of a deduction from pay allowed under paragraph (b) of this section, the employer may use the hourly or daily equivalent of the employee’s full weekly salary or any other amount proportional to the time actually missed by the employee. A deduction from pay as a penalty for violations of major safety rules under paragraph (b)(4) of this section may be made in any amount.
(emphasis added). Therefore, under the express terms of section 541.602(c), an employer may calculate a deduction for a full-day absence based on the number of hours actually missed. Thus, for example, if the RN was scheduled to be on call Friday from 2:30 p.m. to midnight, but was unable to work any hours that day for one of the reasons described in section 541.602(b), the hospital could deduct 9.5 hours from her salary (i.e., the amount actually missed) in accordance with section 541.602(c). Again, however, you should note the deductions are not permissible if the employee is absent for less than one full day of work.
This opinion is based exclusively on the facts and circumstances described in your request and is given on the basis of your representation, express or implied, that you have provided a full and fair description of all the facts and circumstances that would be pertinent to our consideration of the questions presented. Existence of any other factual or historical background not contained in your request might require a different conclusion than the one expressed herein. You have represented that this opinion is not sought by a party to a pending private litigation concerning the issue addressed herein. You have also represented that this opinion is not sought in connection with an investigation or litigation between a client or firm and the Wage and Hour Division or the Department of Labor.
We trust that this letter is responsive to your inquiry.
Alexander J. Passantino
* Note: The actual name(s) was removed to preserve privacy in accordance with 5 U.S.C. § 552(b)(7).