60 | Massachusetts Wage & Hour Peculiarities, 2025 ed. © 2025 Seyfarth Shaw LLP (2) Deductions for Personal Absences Deductions from pay are permissible when an exempt employee is absent from work for one or more full days for personal reasons other than sickness or disability.334 An employer may not deduct any amount from an exempt employee’s pay when the employee is absent only part of a day.335 An employer may, however, take deductions from an employee’s vacation or leave bank in less than full-day increments, so long as the deductions do not affect the amount of salary paid to the employee.336 (3) Deductions for Sickness or Disability An employer may make deductions from an employee’s pay for absences of one or more full days because of sickness or disability if the deductions are made in accordance with a bona fide plan, policy, or practice providing compensation for loss of salary because of illness.337 The employer does not need to pay any portion of the employee’s salary for full-day absences for which the employee receives compensation under the employer’s plan, policy, or practice.338 Further, the employer may make deductions for full-day absences due to sickness or disability if the employee receives salary replacement benefits through workers’ compensation or disability insurance.339 (4) Deductions Taken Pursuant to the Family and Medical Leave Act and Massachusetts Leave Laws Under the FMLA, qualified employees are entitled to unpaid leave under certain circumstances. With respect to the salary basis test, an employer is not required to pay the full salary of an employee who takes unpaid leave under the FMLA even where the leave is not taken in full-day increments.340 Thus, the employer may make deductions from an exempt employee’s salary for “any hours taken as intermittent or reduced FMLA leave within a workweek, without affecting the exempt status of the employee.”341 The employer is only obligated to pay a proportionate part of the employee’s full salary for the time actually worked.342 For example, if an employee 334 29 C.F.R. § 541.602(b)(1). 335 Id. 336 See Section V.A.2.b(5) for a detailed discussion of permissible deductions from an employee’s vacation or leave bank. 337 29 C.F.R. § 541.602(b)(2). 338 Id. Deductions from an employee’s salary are permissible for full-day absences that occur before the employee has qualified under an employer’s plan, policy, or practice, as well as for full-day absences taken by an employee after the employee has exhausted the available leave. For example, if an employer’s short-term disability policy allows for twelve weeks of leave beginning on the fourth day of an absence, an employer may make deductions from pay for the three days prior to qualifying for the leave and for any full-day absences following the twelve-week leave period. 339 Id. 340 29 C.F.R. § 541.602(b)(7). 341 29 C.F.R. § 825.206(a). 342 29 C.F.R. § 541.602(b)(7).
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