Code of Maine Rules › 12 - DEPARTMENT OF LABOR › 170 - BUREAU OF LABOR STANDARDS › Chapter 16 - RULES GOVERNING DEFINITIONS FOR EXECUTIVE, ADMINISTRATIVE, AND PROFESSIONAL EXEMPTIONS FROM MINIMUM WAGE AND OVERTIME › Section 170-16-IV - Effect of Improper Deductions from Salary

Current through 2024-29, July 17, 2024
An employer who makes improper deductions from salary shall
				  lose the exemption if the facts demonstrate that the employer did not intend to
				  pay employees on a salary basis. An actual practice of making improper
				  deductions demonstrates that the employer did not intend to pay employees on a
				  salary basis. The factors to consider when determining whether an employer has
				  an actual practice of making improper deductions include, but are not limited
				  to: the number of improper deductions, particularly as compared to the number
				  of employee infractions warranting discipline; the time period during which the
				  employer made improper deductions; the number and geographic location of
				  employees whose salary was improperly reduced; the number and geographic
				  location of managers responsible for taking the improper deductions; and
				  whether the employer has a clearly communicated policy permitting or
				  prohibiting improper deductions.
A. If
				the facts demonstrate that the employer has an actual practice of making
				improper deductions, then the exemption is lost during the time period in which
				the improper deductions were made for employees in the same job classification
				working for the same managers responsible for the actual improper deductions.
				Employees in different job classifications or who work for different managers
				do not lose their status as exempt employees. [Example: if a manager at a
				company facility routinely docks the pay of engineers at that facility for
				partial-day absences, then all engineers at that facility whose pay could have
				been improperly docked by the manager would lose the exemption; engineers at
				other facilities or working for other managers, however, would remain
				exempt.]
B. Improper deductions
				that are either isolated or inadvertent will not result in loss of the
				exemption for any employees subject to such improper deductions, if the
				employer reimburses the employees for such improper deductions.
C. If an employer has a clearly communicated
				policy that prohibits the improper pay deductions specified in paragraph IV (A)
				and includes a complaint mechanism, reimburses employees for any improper
				deductions and makes a good faith commitment to comply in the future, then such
				employer will not lose the exemption for any employees unless the employer
				willfully violates the policy by continuing to make improper deductions after
				receiving employee complaints. If an employer fails to reimburse employees for
				any improper deductions or continues to make improper deductions after
				receiving employee complaints, then the exemption is lost during the time
				period in which the improper deductions were made for employees in the same job
				classifications working for the same managers responsible for the actual
				improper deductions. The best evidence of a clearly communicated policy is a
				written policy that was distributed to employees prior to the improper pay
				deductions by, for example, providing a copy of the policy to employees at the
				time of hire, publishing the policy in an employee handbook or publishing the
				policy on the employer's Intranet.
This section shall not be construed in an unduly technical
				  manner so as to defeat the exemption.