A client recently asked, “When can we deduct from an employee’s pay?”
In general, if an exempt employee performs any work during the work week, you must pay them their full salary amount. Deductions are allowed, however, for legally required withholding and benefit elections.
There are other situations in which a deduction from an exempt employee’s salary would be permissible under federal law:
- For any work week in which the employee performs no work
- In the initial or final week of employment based on the number of hours actually worked
- For absences of one or more full days for personal reasons other than sickness or disability