UNPAID SUSPENSIONS

Steven Cesare, Ph.D.

An exasperated business owner from California called me the other day to recount the ongoing disciplinary process he has been through with one his Maintenance Production Managers. As a long-time employee the Maintenance Production Manager has historically been successful, consistently meeting performance metrics, overseeing multiple field crews, and presenting himself as a true role model of the company culture.

However, over the past several months, the Maintenance Production Manager has seemingly gone to the “dark side,” by refusing to complete work assignments, miscalculating work orders, coercing field employees to misrepresent their hours worked on their timesheets, and demonstrating negative energy by making cynical comments, bad-mouthing the company, and challenging the executive team’s decisions.

Given the Maintenance Production Manager’s past performance, the business owner let some of the performance issues slide-by without formal documentation, so as not to upset the Maintenance Production Manager, all the while hoping he would rebound to his former performance level.

There was no rebound.

Actually, it was an air ball.

Things only became worse. Accordingly, the formal performance management documentation began: several verbal coaching episodes, followed by multiple written reprimands, followed closely by the decision to suspend the employee without pay for two weeks.

In specific, the Maintenance Production Manager came to work on a Monday, failed to meet yet another basic performance standard, and was informed that he was being suspended without pay for the rest of the current work week, as well as the next work week. The owner innately believed that almost two weeks without pay would trigger the employee to improve his work performance.

Not so fast, Mister business owner.

Per the Fair Labor Standards Act (FLSA), there are differential legal stipulations regarding unpaid suspensions based on whether the employee is classified as non-exempt or exempt. The Maintenance Production Manager was classified as an exempt employee.

As is commonly understood, the FLSA allows employers to apply unpaid suspensions to non-exempt workers, since they would not be at work during the suspension, and as such, no work hours would be completed, eventuating in no pay for the hours not worked.

By way of contrast, the FLSA only allows employers to impose in good faith an unpaid suspension to exempt employees for infractions of workplace conduct rules, such as rules prohibiting sexual harassment, workplace violence, or drug or alcohol use or for violations of state or Federal laws. This provision refers to serious misconduct, not performance or attendance issues. And, the unpaid suspension must be imposed pursuant to a written policy, typically found in the Employee Handbook.

You know what’s coming next…

The Employee Handbook had no such policy contained within it.

No written policy; no unpaid suspension.

Even beyond that point, since the exempt Maintenance Production Manager performed work on Monday, the owner was legally bound to pay him for the entire first week of the “unpaid” suspension anyway. And since the Manager was willing and able to work, the owner could not dock his pay for the second week either, nor could the owner make any deductions from the Manager’s leave balances.

What do you think will happen when the Maintenance Production Manager eventually “lawyer’s up?”

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