Our new exempt employee has been ill for three full days and two half-days during her first 15 days of employment. It’s a rocky start. She has not accrued any PTO. Should we “advance” her some PTO, or not pay her for the full days absent. Can we also deduct wages for the half-days absent?

Great question. So many employers find themselves in situations like this often. The FLSA says we must pay overtime-exempt employees when they work “any part of a day or any part of a week”. However, the FLSA also says we can dock the employee’s pay for full-day absences when no work is performed – IF we have a clearly communicated (written and acknowledged) policy in place before the absence occurs. If the absence is caused by sickness or disability, we may only doc the pay when the worker has not qualified for our company’s paid sick time plan OR when the employee has exhausted all provisions of the plan. We cannot ever doc a half-day UNLESS we are a public (government) employer – City, State, County, etc.

You may advance her the PTO and then she would have a negative balance in her PTO bank. However, if she leaves the company with a negative balance in her bank, you will not be allowed to deduct this balance from her pay.

Here are some links to help you with further research.
https://www.dol.gov/whd/overtime/fs17g_salary.pdf
https://www.atlantaovertimelawyersblog.com/2016/02/can-employer-deductdock-pay-salaried-employee.html
http://www.lni.wa.gov/WorkplaceRights/files/policies/esa91.pdf

I hope this helps!