While most employers understand their minimum wage and overtime obligations for non-exempt employees, not everyone is familiar with the complexities of determining what time is considered compensable. This is an important distinction. Obviously, time in the office during the work day is working time, but there are a number of other ways employees may spend their time that are considered “hours worked” by the Department of Labor and therefore must be paid time.
Any time in which an employee is “suffered or permitted” to work is compensable. This includes work not requested as well as work the employer knew or should have known the employee performed. Common trouble spots include working through lunch, coming in early to avoid traffic, “volunteering” time, taking work home, and responding to emails after hours. All of these hours have to be logged and earnings paid to the employee.
Breaks and Meal Periods
Except for minors, federal law does not require employers to provide breaks (although some states DO have break requirements). However, the law does determine when any breaks must be paid. Short breaks, generally under about 20 minutes, have to be paid, as such short periods of time are more for the employer’s benefit and do not really provide employees time to engage in personal pursuits. Accordingly, employers may require employees to stay onsite during paid breaks.
Bona fide meal periods of at least 30 minutes can be unpaid, but only if employees are completely relieved of their duties during that unpaid time and perform no work. To ensure they don’t inadvertently perform work-related tasks, many employers require employees to leave their workstation during unpaid breaks. It is important to note that for these breaks to be unpaid, they must be 30 or more continuous minutes; they cannot be converted into, say, two 15-minute breaks at different times of the workday.
While there are many scenarios for local travel, most of which is paid, this article addresses travel that takes an employee away from their home city. Whether this time is paid, and to what extent, depends on whether the out-of-town travel is all in one day or requires an overnight stay.
Travel away from the employee’s home city when the employee returns home the same evening is paid because it is not ordinary home-to-work travel – in other words, the hours the employee spends getting to and from the destination need to be logged as work hours. However, employers may deduct normal commuting time from the amount – that is, the time it normally takes the employee to travel from home to their regular place of work and back home again.
Overnight travel is a bit trickier. The time an employee spends as a passenger traveling to/from the away city is paid to the extent it crosses the employee’s normal work hours, regardless of the day of the week. So, if the employee normally works 8:00AM – 5:00PM, travel to/from the away city that occurs between 8:00AM and 5:00PM must be paid, even if it’s not a day of the week the employee normally works. Travel outside of that timeframe generally does not have to be paid, unless the employee performs any work-related functions during the time. Note that if the employee is required by the employer to drive to the away city (versus being a passenger on any mode of transportation), any time spent driving is considered work time, no matter when it occurs.
Meetings, Trainings, Etc.
Of course, employees must be paid for any meetings or training sessions that they are required to attend. However, there are circumstances for which their attendance at these types of functions can be unpaid, provided all four of the following criteria are met:
- Attendance is outside of normal working hours.
- Attendance is truly voluntary, which is not the case if an employee feels coerced or that not attending will have a negative impact.
- The content of the function and the time spent is not directly related to the employee’s current job.
- The employee performs no other work during the time.
While the above scenarios are the most common employers face, the Department of Labor also has parameters for when less common situations must be paid, including on-call time, waiting time and sleep time. What employers need to remember in these situations is that any time employees spend while connected to or under the control of their employer, even though they may not be actively producing, is likely to be compensable. Further, while many of these circumstances may not “feel” like actual working time, because the time is considered hours worked, then it does count toward overtime. Employers can minimize their exposure to overtime by restructuring work weeks in which these extra functions occur to ensure the employee’s total time for the week, including these activities, does not exceed 40 hours.
A final word: failure to pay non-exempt employees for these times can result in up to three years of back wages and taxes, fines, penalties, liquidated damages, and criminal prosecution.
By Charlotte Jensen, Vice President, HR Compliance – Affinity HR Group
Charlotte Jensen, Vice President, HR Compliance, is a contributor for Affinity HR Group, LLC, NAFCD’s affiliated human resources partner. Affinity HR Group specializes in providing human resources assistance to associations such as NAFCD and their member companies. To learn more, visit www.affinityHRgroup.com.”