Mother Nature, Acts of God, and Payroll for Your Nonprofit

Wednesday, November 18, 2020 – There are very few things in life you can’t control, and weather is one of them. So how do you handle extreme weather emergencies and payroll for your nonprofit?

The weather report features the pending “Snowpocalypse.” Hurricane Petunia is barreling down the coast. Whatever the weather, your nonprofit will need to cope with related closures at some point. The question many nonprofit organizers have is whether they are required to pay employees if Mother Nature forces them to close for the day.

Salaried versus Hourly Employees

According to federal law, salaried, exempt employees who have worked at least part of the workweek cannot have their pay docked if you shut down your office because of weather-related conditions. Nonexempt or hourly employees do not have to be paid.

Some employers also wonder whether they can ask exempt employees to take personal days or vacation days or even to telecommute on days when the office shuts down because of inclement weather. In fact, these are legal alternatives when the office is closed.

Your best course of action is to make your policy crystal clear and confirm that it doesn’t violate federal or local laws. Put it in writing in each employee manual and ensure that employees know about policies well in advance. By having policies spelled out in advance, you avoid bad feelings, confusion, and problems.

Consider a Generous Policy

Regulations aside, should you still pay nonexempt staff when you close the office or refrain from docking vacation or personal days for exempt staff? It is probably the fair thing to do. Let’s face it: weather-related closures rarely happen. Is it really worth the bad feelings if employees can’t work because the office is closed?

Even if you think you can open the office because a few people live close by, is it wise to do so? You don’t want employees getting injured on their way to work as a result of traffic accidents or other problems from inclement weather. No one wants that, and asking people to stay home is the fair thing to do. Of course, depending on the work you do, many employees will be able to work from home and remain productive, as long as the weather hasn’t knocked out the power. For many modern nonprofits, this may be the most reasonable solution.

Keep in mind that state rules may require you to pay nonexempt employees even in situations in which federal rules do not. To ensure that you don’t inadvertently violate any federal or state rules, it’s a good idea to consult with a qualified payroll or accounting professional before docking anyone’s pay or personal time.

Yes, it may be costly to pay people even when you don’t legally have to, but in the long run, a happy workforce is a productive workforce. Paying your nonprofit staff and allowing them to keep their vacation days when you’re forced to shut down because of weather issues may be the best solution.

Do you want to know more ways to navigate these complicated payroll issues as a nonprofit organization? Give us a call today.