The designation of an employee as “salaried” often creates the misconception that they possess complete control over their work schedule. This misunderstanding stems from a lack of clarity regarding the legal distinction between being paid a salary and being exempt from federal wage laws. The law establishes a clear relationship between an employer’s right to set a schedule and the rules governing how that employee is compensated. This article clarifies the legal framework defining an employer’s authority to mandate specific hours for a salaried employee.
Understanding Exempt vs. Non-Exempt Status
The core issue governing an employee’s rights and an employer’s obligations is the employee’s status under the Fair Labor Standards Act (FLSA), not the salary itself. The FLSA separates employees into two categories: non-exempt and exempt. Non-exempt employees are subject to the Act’s protections, meaning they must be paid at least the minimum wage and receive overtime pay for hours worked over 40 in a workweek.
The term “salaried” simply describes a method of payment where an employee receives a predetermined amount of compensation each pay period. An employee can be non-exempt and still be paid a salary, though they remain entitled to overtime pay.
An employee is designated “exempt” only if they meet three specific tests: the minimum salary level test, the salary basis test, and a duties test related to their job function (e.g., executive, administrative, or professional responsibilities). When an employee is properly classified as exempt, the employer is not legally required to pay them overtime. This exemption from overtime is the fundamental difference, and it is separate from the employer’s right to establish a work schedule.
The Legal Right to Mandate Specific Hours
An employer can indeed require a salaried employee to adhere to a specific work schedule, including a standard 40-hour workweek or specific core hours each day. The FLSA’s requirements for exempt status are focused on how an employee is paid and whether they qualify for overtime, not on restricting the employer’s ability to manage their daily operations. The law does not grant salaried employees a right to set their own hours simply because they are exempt.
For an employee to qualify as exempt, they must satisfy the duties test, which examines the nature of their work. This test is satisfied independently of any scheduling requirements, meaning the employer retains the right to dictate when the employee must be present to perform those duties. As long as the employee meets the salary level and salary basis tests, the employer can enforce a schedule like 9:00 a.m. to 5:00 p.m. without compromising the exempt status.
Business Justifications for Strict Schedules
Employers implement specific schedules for exempt staff primarily for operational reasons. These schedules ensure employees are available when needed to interact with clients, customers, or vendors. For example, a company may set core hours to facilitate necessary team collaboration and in-person meetings.
Mandating specific hours also supports the need for direct supervision and management oversight. Performance metrics and project deadlines are often tied to specific operating hours, making scheduled attendance necessary for effective workflow management. These policies are established to maintain business continuity and efficiency.
Rules Governing Pay Deductions for Missed Time
While an employer can mandate a schedule, their ability to reduce a salaried exempt employee’s pay is highly restricted by the “salary basis test,” outlined in 29 CFR Part 541. This test requires that an exempt employee receive their full predetermined salary for any week in which they perform any work, regardless of the number of days or hours worked. Improperly deducting pay can cause an employee to lose their exempt status, potentially making the employer liable for past unpaid overtime.
There are specific, limited exceptions where deductions are permissible:
- Deductions for full-day absences for personal reasons (not including sickness or disability).
- Deductions for full-day absences when an employee has exhausted available paid time off, provided the employer has a bona fide sick leave plan.
- Unpaid disciplinary suspensions of one or more full days imposed for violations of workplace conduct rules, provided the policy is applied consistently.
- Payment of a proportionate part of the full salary for time actually worked during the first or last week of employment.
The most important distinction is that deducting pay for partial-day absences, such as leaving two hours early for an appointment, is generally prohibited and violates the salary basis test.
Consequences for Failing to Meet Scheduling Requirements
When a salaried employee fails to adhere to a required schedule, the employer’s recourse is typically non-monetary disciplinary action, rather than deducting pay for partial absences. Since docking pay for tardiness or short absences is usually illegal, the employer must rely on performance management tools.
Failure to meet the established workplace policy, which includes schedule adherence, is a valid reason for disciplinary action. This process often involves a system of progressive discipline, such as verbal warnings, formal written warnings, and performance improvement plans. If the issue persists, the employer can enforce an unpaid disciplinary suspension for one or more full days for a violation of a workplace conduct rule. Ultimately, consistent and documented failure to meet the required schedule can lead to termination of employment, provided the policy is applied equally to all similarly situated employees.