Paid time off (PTO) is not part of an employee’s salary, and therefore an employer did not violate the Fair Labor Standards Act (FLSA) by making deductions from FLSA-exempt employees’ paid time off if they failed to meet productivity goals, the U.S. Court of Appeals for the Third Circuit ruled recently in a case of first impression. The workers in Higgins v. Bayada Home Health Care, Inc., argued unsuccessfully that the deductions were impermissible under the FLSA because in effect they made the workers nonexempt employees eligible for overtime.
Members of the Center for Workplace Compliance (CWC) can read more here.