“Do As We Say, Not As We Do”: The Lesson for Employers from the Shutdown

As the federal government’s shutdown nears the end of its third week, one has to wonder why many federal employees are required to work even when they aren’t being paid. Could you as a private employer ever require your employees to work without pay during a crisis period at your business? Of course not.

About half of the 800,000-strong federal workforce is sitting at home worrying about their finances because they are “furloughed”. At least that group is not performing any work, so being unpaid is legal, although obviously unacceptable for their financial security.

The other half, those whose jobs involve public health and safety, are required to report to work even though Congress has not appropriated any money to pay their salaries. FBI agents, air traffic controllers, TSA agents, the Coast Guard, and, ironically, Border Patrol officers, are all working without pay right now. If one of these essential employees refuses to report to work because of the lack of compensation, he/she will be considered absent without leave and faces disciplinary action.

Most federal employees are on biweekly pay, so on Friday, January 11, the bulk of that workforce will receive nothing for work performed December 23 through January 4. No money for rent, food, transportation, etc., will be available to those workers until both houses of Congress pass funding legislation and the President signs it.

A federal shutdown has never lasted more than three weeks before, so the fact that the shutdown is dragging on and there are no positive signs of an agreement right now is obviously distressing to these employees, many of whom are poorly compensated and live paycheck to paycheck.

The federal government is unique in its ability to require this kind of unpaid servitude of its employees. As the Atlantic recently explained:

Since the enactment of the Taft-Hartley Act in 1947, federal employees have been legally prohibited from striking. That law was intended to prevent public-sector workers from leveraging a work stoppage that could cripple the U.S. government or major industries in negotiations for better pay, working conditions, and benefits. But it likely did not envision a scenario where the government would require its employees to work without paying them, as is the case now.

What prevents you as a private employer from taking a play from this playbook and requiring your employees to work without pay when your business has a cash flow problem?

A federal law, the Fair Labor Standards Act (“FLSA”), requires employers to pay minimum wage to employees of at least $7.25 per hour. That law is enforced on a weekly basis, so anytime an employee works one week without receiving any pay, or even some pay but not the required minimum per hour, his employer has violated the FLSA.

Interestingly, one of the almost universally-applied penalty provisions for violations of the FLSA is to require the employer to pay double damages. In other words, if reported to the Department of Labor, the employer has to pay the employee twice the amount of wages due for the period the employee was not properly paid.

Most federal workers, such as clerks at the Census Bureau, museum guides at the Smithsonian, firefighters on federal lands in the West, and corrections officers take home about $500 per week. So, the federal government should owe these employees $1000 in take home pay for any missed paychecks if the same FLSA rules applied to the U.S. Government that apply to your company.

But the government has exempted itself from these rules. They simply want private companies to “do as we say, not as we do.” And because of the broad enforcement powers of the Department of Labor, as an employer, you are wise to follow the law rather than the government’s bad example.

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