Not allowed to use PTO

[shinyfun]

What is the name of your state (only U.S. law)? South Carolina

I have about 60hrs accrued PTO.

I put in for time off for the day after Thanksgiving about 2 weeks ago. Last Friday (November 21, 2008), I was told that all salary employees would be allowed to take that day off (no one is expected to show up) and that there will be a skeleton crew of hourly employees working that day. However, those that aren't working that day will not be able to use their PTO for that day, it must be taken UNPAID.

I was also informed that no salary employees can use their PTO (they CAN however take unpaid leave) until the company president chooses to lift the ban (basically throughout the holidays probably lasting into or after February 2009). Of course by then I will be working for a different company, but my current employer doesn't yet know that. They will not pay out my earned PTO when I quit. So it's a use it or lose it scenario, only without the use it part.

I was told this was so the company could "cut costs" as the economy has really cut into the company profits.

Is this legal?

 

[cbg]

That depends.

Salaried is only a pay method and means little or nothing by itself. What matters is whether the employee is exempt or non-exempt. Either can be paid on a salaried basis.

Which are you?

 

[shinyfun]

Exempt

I believe I am exempt. I don't get paid any more than my salary regardless of the number of hours I work. But apparently, I can get docked pay.

The hourly employees will be allowed to use their PTO for this day. It's just the salaried employees that are told they won't get it. And I was told that no salary employees will be working that day just a skeleton crew of hourly employees.

 

[cbg]

Your employers have it backwards.

It WOULD be legal to require the non-exempt employees to take time without pay. Non-exempt employees never have a legal expectation of being paid when they do not work, with very limited exceptions that do not apply here.

Exempt employees, on the other hand, can have their salary docked in the following situations and ONLY in the following situations:

1.) It is the first or last week of work and the employee does not work the entire week
2.) The employee is on FMLA
3.) The employer offers a reasonable number of paid sick days, and the employee calls in sick at a time when he has either used all the days available to him or is not yet eligible for them
4.) The employee voluntarily takes a full day off for personal reasons
5.) The employee was suspended for a major safety violation
6.) The employee was suspended for the violation of a written company policy which applies to all employees and which relates to workplace conduct (workplace violence, sexual harassment, drugs/alcohol in the workplace, etc.).

An exempt employee CANNOT have their pay docked for days on which the company is closed unless the employee does no work at all during the full work week. He CAN be required to use PTO with or without his knowledge or permission, but he CANNOT be required to take the time unpaid.

 

[shinyfun]

Here's the rub

The company isn't shut down. I CAN show up if I want to, but no one else will be here except a couple of hourly employees and there won't be anything for me to do.

I guess it doesn't really matter, I'll be putting in my notice in three weeks, AND if I read the handbook correctly they will pay out my earned PTO when I leave. "All accrued, vested benefits that are due and payable at termination will be paid as soon as reasonably practicable." This is all the handbook says about it. I'm going to ask one of our old employees if he was paid out.

 

[Ronin]

Seems like the forced time off is happening a lot more often these days. A lot of employers do not understand the laws, and are still learning and making adjustments to their policies from one day to the next.

I work for a large corporation which is having a couple of weeks of mandatory shutdowns this year. Anyway, they found that the non-exempts are entitled to unemployment benefits for the days they are not allowed to work and do not have vacation time to cover this. So the company is now encouraging this for those it may apply to.

The exempts on the other hand pretty much have the requirements as outlined by CBG above. My company is a bit more flexible and willing to stretch the above requirements, and the bottom line is only a very few folks will actually be docked any pay.

In no instance is my company not allowing anyone to take their earned PTO and forcing them to take this time as unpaid. I believe your company is crossing the legal line here. If this policy is very recent there is a pretty good chance that if your company did err they will learn this soon enough, and they will be making a later change to their policy.

 

[shinyfun]

One More Question

Yeah, I agree that they're crossing the line. But in SC, they don't have any laws regarding PTO. Basically, it states that whatever the company handbook says is what the company has to follow. Only the language in the handbook is vague and confusing. It doesn't stipulate anything that the company MUST do, only what the employee must do. But in regards to PTO, it says how we earn it and how we may use it, but it also says that it's up to the company's discretion if we can use it or not. In this case we can take the day off but we can't use our PTO for it.

FYI, this is a small company and it seems I'm the only one who really cares (I'm the lowest on the totem pole of salaried employees and need all of my salary to pay the bills).

ONE MORE QUESTION:

I mentioned in my last post the one line about PTO payout if you quit or are fired.
"Employee benefits will be affected by employment termination in the following manner. All accrued, vested benefits that are due and payable at termination will be paid as soon as reasonably practicable. The employee will be notified in writing of the benefits that may be continued and of the terms, conditions, and limitations of such continuance."

Would you take this to mean that you will be paid out for you accrued PTO?

 

[cbg]

No state has any laws regarding PTO, with the possible exception of CA in some limited circumstances. About half the states have laws regarding the payout of PTO or vacation at termination, but there just aren't any laws anywhere about how PTO has to be applied.

SC doesn't have a lot of employment laws, but they do require employers to stick to what they've put in writing, and if any changes are made the changes have to be given to you in writing before they are valid. So yes, I would agree that in the absence of something that specifies the circumstances under which vacation/PTO would be forfeited, you should have it paid out at termination based on what you have posted.

 

[shinyfun]

Update

OK, so they realized that forbidding the use of earned PTO was illegal... or so I was told. Anyway, to make up for it, they are doing a 10% pay deference. 10% of my pay will be withheld for company use, until such time that they feel they can repay me. I could see that a salary cut would be legal, but a deference? What do you think?

 

[pattytx]

No, forbidding the use of PTO was NOT illegal.

Tell us more about this "deferral". What is the intent? Is your gross pay being reduced or is a deduction being made from your NET pay?

 

[shinyfun]

"What is the intent? " The company is losing money fast and in an attempt to keep the company alive, they've decided that all salary employees would have a percentage of their salary deducted for company use. Not all percentages are equal. I'm at 10% but have been told that others are higher and some are lower... depending on your worth to the company and your market worth.

Then, if the company pulls through or gets an investor, we will be paid back in a lump sum. They are calling it a deferral and will last indefinitely.

"Is your gross pay being reduced or is a deduction being made from your NET pay?"
Gross pay, before taxes and everything.

(Actually at this point, the situation is moot for me... I just put in my resignation. But I'm still curious.)

I'm in South Carolina.

 

[pattytx]

I don't like the way that was worded, but a salary cut IS legal, as long as you are notified in writing at least 7 days in advance of the effective date.

Q. Can my employer decrease my rate of pay?

A. Yes. However, if the employer has 5 or more employees, the employee must be notified in writing at least seven calendar days in advance of the proposed decrease in pay.

South Carolina Department of Labor, Licensing and Regulation

 

[shinyfun]

Well, there you have it. I was notified "effective immediately there will be a 10% salary deferral". There wasn't any wait, but I was expecting something to happen. I believe though, and I could be wrong, that since I'm leaving the company, they would have to pay back the "deferred" money. They aren't cutting my salary, they are just taking part of it for their own use and I have a written statement that says they will give it back when they decide to.

 

[pattytx]

In reality, though, they ARE cutting your salary. Companies cut salaries, even if temporarily while going through a cash crunch, so they have money to spend elsewhere. Since you've said you're already quitting, though, you'll have to decide whether it would be worth it to file a claim with the state DOL for the difference between the old and the new salary (because the required advance notification was not provided) or just move on.