Puerto Rico was adversely affected by two (2) hurricanes (Irma and María) on September 2017. The direct impact of said hurricanes has caused extreme and significant damage to Puerto Rico, particularly to the infrastructure, utilities, communication and roads. As a consequence, employers have been forced to reduce operations and shut down in some extreme cases.
A question asked by many employers is whether they have to pay wages to those employees who do not work as a passage of the hurricanes. Another question is whether those days may be paid from the accrued vacation leave or any other available leave. The response to these questions will depend on whether the employee is exempt or non-exempt.
Yesterday, October 17, 2017, the Secretary of the Department of Labor and Human Resources of Puerto Rico (hereinafter “the Secretary”) issued “Opinion of the Secretary No. 2017-001” (hereinafter the “Opinion”) that deals with these initial concerns of employers. Attached please find copy of the Opinion for your ready reference.
In summary, the Opinion states that non-exempt employees who work on an hourly basis, have the right to be compensated only for time worked. The employer does not have to compensate employees for time they did not work because of the hurricanes.
Regarding exempt employees, the Opinion of the Secretary states that if the operations closed in the middle of a work week because of the hurricanes, the employer cannot deduct the wages for the days not worked during that week. If during a full week of work the exempt employee did not work at all, the employer does not have to pay the salary for that week. Please note that if the employer requires an exempt employee to report to work and he/she is absent because of personal reasons, the wages of that full day may be deducted from the salary.
If the employer decides not to pay the employees (exempt and non-exempt) for the time not worked, it can opt, at the written request of the employee, to pay him/her from accrued vacation leave or any other leave that the employee is entitled to, based on the employment contract.
This memorandum is a brief summary of the Opinion of the Secretary. There are particular circumstances that the Opinion of the Secretary does not contemplate. Since the Opinion contains certain technical and legal aspects, feel free to call us if you have any questions.