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Ask the Hotline | Working Employee Wants Vacation Time Back

May 9, 2017
While away on vacation, one of our employees was asked by her boss to remotely attend some meetings and do some work. She has returned from vacation and is asking that we give back her vacation time for the three days she had to work. Do we have to do that?
Possibly yes.
Based on your question, it appears that she worked more than just a few minutes. That suggests she should be paid for at least some of the time. It remains for you to determine how much work she did.
Notwithstanding how much time she worked, your question is a multi-layered one that is likely to become commonplace in our interconnected world. 
If a person is working while on a paid vacation, non-payment of wage issues under the Fair Labor Standards Act (FLSA) don’t come into play provided the employee is getting his or her full regular pay.
The next question is whether the employer's charging an employee for vacation during periods that they are doing some work would amount to an unlawful forfeiture of earned vacation under Massachusetts law.  
There is a strong possibility that it may, particularly if:
  • the employer asked/required the employee to do it; 
  • it represents more than a de minimis (i.e. an insignificant) amount of time; and 
  • the vacation was paid pursuant to an earned time policy. 
The specific language of the time-off policy, and the type of vacation pay (Paid Time Off, use it or lose it, unlimited, etc.) may also impact the determination.  For example, if the employer has a “use it or lose it” vacation policy and the demands of the workplace leave the employee without adequate time to use vacation, it could bolster the employee’s argument that he/she was owed wages for the time spent working while on “vacation.” On the other hand, if the employee does have a reasonable amount of time to use vacation, there is less worry about the forfeiture of vacation time issue. 
Exempt/non-exempt employees
The discussion above may break differently depending upon whether the employee is exempt (salaried) or non-exempt (hourly).  Non-exempt employees who work during a scheduled vacation only need to be paid for the time that they work, so if you establish an accurate time-tracking system, you should be fine. 
Exempt employees present more of a challenge.   As a rule, an exempt employee must receive his/her full regular salary for any week in he/she performs work.   Deductions from that guaranteed weekly salary are permissible for instances in which an employee is absent from work for one or more full days for personal reasons other than sickness or disability (like taking a vacation) and for absences of one or more full days due to sickness or disability if the deduction is made in accordance with a bona fide plan, policy or practice of providing compensation for salary lost due to illness.
The US Department of Labor has taken the position that where an employer has a benefits plan (e.g., vacation time, sick leave, PTO), it is permissible to substitute or reduce the accrued leave in the plan for the time an employee is absent from work, whether the absence is a partial day or a full day, without affecting the salary basis of payment, if the employee nevertheless receives payment in full of his or her guaranteed salary.  So, if an employee is taking a paid vacation and does three hours of work, the employer could give the employee regular pay for the three hours and vacation pay for the rest.
But consider a situation in which an exempt employee takes a day of unpaid vacation.  If the employee does any work at all during that day, they must be paid in full for the day.       
The issue also comes up when an employee is out on a leave of absence - for example, receiving pay through sick, vacation, and/or Short Term Disability (STD). In a typical situation, the employer or a co-worker may ask a question or two and the employee, wanting to be helpful and perhaps stay connected, performs some work in response. While the same de minimis standard may apply, it is easy to foresee a situation in which one quick call turns into a half-hour conversation. 
If it appears that an employee is working during a leave of absence, it makes sense to have a discussion around the extent to which the employee is required and/or permitted to work, and how time tracking and compensation for such work will be handled. Once you have reached an agreement, you should confirm it in writing to make sure that there are no misunderstandings later.   And keep in mind, many STD policies explicitly prohibit an employee from collecting STD benefits and working at all. 
Situations like this need to be managed to make sure everyone follows your company policy. Some employees cannot bear to disengage, and will work for part of the time of every vacation or leave, but there are also some underhanded employees who may claim falsely to be working from home, when in fact all they did was glance at a few emails. 
If you allow the employee to work, establish some clear parameters about how to track the time. It’s trickier if you are dealing with an hourly (non-exempt) employee, or if employees can build up unlimited amounts of accrued time. 
If you determine that the employee should not be working, make sure you communicate that to the employee on leave as well as to all the relevant managers and co-workers so that no one inadvertently violates your rule. On the other hand, if you decide that an employee may work a for a specific amount of time during the vacation or leave, you may want to designate one manager or co-worker as the gate keeper for all communication with the employee. 
(AIM wishes to recognize the assistance of the law firm of Hirsch Roberts Weinstein in preparing this answer.) 
If you have any questions about this or any other HR related issue, please call the AIM Employer Hotline at 800-470-6277. 
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