California DLSE Issues Opinion Letter Regarding Deductions for Partial- and Full-Day Absences for Exempt Employees

On November 23, the California Division of Labor Standards Enforcement (DLSE) issued an opinion letter stating that employers may deduct vacation and sick leave banks for exempt employees’ partial-day absences of fewer than four hours, without undermining the salary basis for application of the white collar exemptions.

This is a change in policy by the DLSE. However, employers will still need to proceed with caution, taking into account their own internal policies with regard to use of vacation, noting the special considerations outlined in the letter, and keeping in mind that courts are not obligated to follow DLSE opinion letters.

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