Are mandatory furlough days legal in california?
There is no section of the California Labor Code, nor any regulation of the Labor Commissioner directly dealing with the question of a furlough, as it concerns private employers. There are some cases dealing with public/governent employees, however, I assume that this doesn't apply to you.
Federal law, however, prohibits suspending salary for a salary-exempt employee, “for absences occasioned ... by the operating requirements of the business” (e.g., lack of work). 29 CFR 541.602(a). Thus, a salary-exempt employee is entitled to his or her salary if the employer furlougs the employee on an irregular basis.
However, where there is a regular furlough, which is anticipated in advance, then the employer can reduce salary to compensate for the days not worked. See In re Wal–Mart Stores, Inc. (10th Cir. 2005) 395 F3d 1177, 1179, 1187.If the company goes to mandatory furlough days can exempt employees are converted to non-exempt to calculate payroll. Everyone will be converted to non-exempt under this move.
A: The salary-exempt laws do not require their application. An employer is free to treat the employee as salary-exempt or hourly non-exempt. However, the timing of change from one status to the other must be determined by the "totality of the circumstances." There is no bright-line test. See Counts v. South Carolina Electric & Gas Co. (4th Cir. 2003) 317 F3d 453, 456.
Hope this helps.
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