Don’t dock exempt workers’ pay for lost equipment — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily

Don’t dock exempt workers’ pay for lost equipment

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While you can set a policy that deducts from nonexempt employees' wages if they damage or lose company equipment, don't extend that policy to exempt employees or you'll risk their exemption status.

Exempt employees must receive their full, predetermined salary, "not subject to reduction because of variations in the quality or quantity of work." Some exceptions are allowed, such as full-day deductions for safety violations. But a Labor Department opinion letter says, "None of the exceptions contemplates charging employees a fine for damage to or loss of company equipment."

Go to, click on FLSA2006-7. 

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