Mass-Peculiarities: An Employers Guide to Wage & Hour Law in the Bay State 2022 Edition

© 2022 Seyfarth Shaw LLP Massachusetts Wage & Hour Peculiarities, 2022 ed. | 87 employer may make deductions for full-day absences due to sickness or disability if the employee receives salary replacement benefits through workers’ compensation or disability insurance. 474 (4) Deductions Taken Pursuant to the Family and Medical Leave Act andMassachusetts Leave Laws Under the FMLA, qualified employees are entitled to unpaid leave under certain circumstances. With respect to the salary basis test, an employer is not required to pay the full salary of an employee who takes unpaid leave under the FMLA even where the leave is not taken in full-day increments. 475 Thus, the employer may make deductions from an exempt employee’s salary for “any hours taken as intermittent or reduced FMLA leave within a workweek, without affecting the exempt status of the employee.” 476 The employer is only obligated to pay a proportionate part of the employee’s full salary for the time actually worked. 477 For example, if an employee generally works forty hours per week but uses ten hours of unpaid leave under the FMLA, the employer may deduct 25 percent of the employee’s normal salary for that week. If an exempt employee takes leave pursuant to the SNLA, the MPFML, or any other Massachusetts leave law, and the leave does not also qualify as FMLA leave, deductions may only be made from the employee’s pay for leave taken in full-day increments. 478 For example, if an exempt employee works part of a day and takes leave pursuant to the SNLA for the remainder of the day, the employee must be paid for the full day to avoid compromising the salary basis test. 479 (5) Deductions from Vacation or Leave Banks There is an important distinction between deductions from the salary of an exempt employee and deductions from an exempt employee’s vacation or leave bank. Deductions from leave banks are not treated as deductions from salary, so long as the total amount the employee receives in his or her paycheck each pay period, including any amounts from paid vacation or sick leave, equals the employee’s full predetermined salary. 480 An employer may mandate use of vacation time from an employee’s vacation bank on a particular day when the employee is not needed due to a lack of work, even though a reduction in pay under those circumstances would constitute an impermissible deduction for an employer-occasioned absence. 481 Similarly, deductions from 474 Id. 475 29 C.F.R. § 541.602(b)(7). 476 29 C.F.R. § 825.206(a). 477 29 C.F.R. § 541.602(b)(7). 478 DOL Wage & Hour Opinion Let ter FLSA2007-6 (Feb. 8, 2007). 479 Id . 480 DOL Wage & Hour Opinion Let ter FLSA2009-2 (Jan. 14, 2009). See also DOL Wage & Hour Opinion Let ter FLSA2005-41 (Oct . 24, 2005) (finding permissible employer’s mandated use of accrued vacat ion on days when employer’s facility is closed due to inclement weather). As explained above in Sect ion III.B.3, there are addit ional risks associated with deduct ions from leave or vacat ion banks under Massachuset t s law because vacat ion t ime is considered wages. 481 Id.