Regarding overtime pay for your employees’ commutes and travel, are you complying with the Fair Labor Standards Act (FLSA)?
FLSA, of course, is a U.S. labor law governing issues including minimum wage and overtime pay.
Figuring out how much money to pay your non-exempt employees and when to pay them for commute and travel time is a multifarious matter.
Without knowing it, it’s easy for you to become noncompliant.
In order to understand the applicable FLSA rules, you need to consider three questions:
- When employees are traveling, what is considered work time?
- When is it business or personal travel time over a weekend?
- When is travel reimbursement appropriate for use of company vehicles in commutes?
Here are answers to questions about typical scenarios:
Before leaving home, if an outside salesperson or repair person checks a computer to respond to emails or to look for the day’s assignments but never goes the office what do you do?
Ordinarily, you don’t have to pay for commuting when the person goes straight to a work site.
However, the question arises over whether the person is actually commuting. Perhaps not.
An employee’s workday starts when they open the computer before leaving home, that’s not commuting. Therefore, the person must be paid for the travel time.
If late in the day you email the following day’s schedule to your employee, who the next morning goes directly from home to the assigned work site, and the commute takes a few hours, do you pay for the travel time?
No, you don’t have to pay travel time – no matter how long the time it takes for your employee to arrive on the scene.
The distance and length of the trip is not a factor. You don’t have to pay for the employee’s commute.
When you tell an employee to get counseling, you pick the counselor and pay for the sessions, what are your obligations?
You must pay travel time.
Even if the employee goes to see the therapist on a day off, you likely must pay for anything related to the session.
Why? It is concluded that you, as the employer, are benefiting from the counseling for the employee.
There are conditions to consider about work time when your employee travels aside from regular working hours. What must you consider regarding the conditions on the types of travel?
Employees who travel to and from work are considered to be commuting. That’s not paid working time. And that’s true even if the worksite changes from one location to another each day.
When your employee goes from job location to another, that’s considered work time.
When an employee goes to another city and returns home the same day, all of it is considered paid work time.
Travel time for overnight travel is paid work time when the travel includes the person’s typical work days.
When your employee travels on non-work days during hours the employee might otherwise be working, it’s paid work time.
But it isn’t paid work time when the employee travels outside her/his regular working hours.
Whether or not it’s payable work time, what are conditions to consider when a non-exempt employ travels for a week to another company office?
Consider these conditions:
You must pay work time even if the employee is traveling over a weekend on what’s normally a day off during what is otherwise considered the person’s normal working hours.
But you don’t have to pay for excess work time if your employee begins the travel during work hours weekend or not and the travel ends after work hours. You only have to pay for travel-work time during the normal shift hours.
You don’t have to pay for travel-work time, if your employee only travels during the non-work hours.
You must pay time-and-a-half overtime, if your employee’s travel time – combined with working hours and non-working hours – totals more than 40 hours.
If an employee drives your firm’s vehicle from home in the morning to the first assigned site, do you have to pay for the driving time?
Even if the work site changes every day, you don’t have to pay for the commute time to the first assignment.
If you require the employee to first drive to your office and then to the off site location, you’re only responsible to pay for the trip from your office to the job site.
From the Coach’s Corner, here more compensation insights:
11 Payroll and Tax Tips for Small Businesses — To stay competitive, it’s vital to be proactive on your taxes. Of course, you should be very familiar with your responsibilities – along with your financial advisor’s input and research with the Internal Revenue Service.
Employees – Overtime Pay Issues and FLSA Exempt Status – Many employers continue to violate wage and hour rules. To avoid costly and time-consuming legal hassles, you might want to review your overtime pay policy and all your exempt-employees’ status to comply with the Fair Labor Standards Act (FLSA).
Tips to Avoid Legal Stress from Nonexempt Pay Errors — If your pay program for nonexempt employees isn’t kosher, you’ll likely be confronted with legal hassles. Such hassles will result in having to pay back wages, overtime, liquidated or double damages.
Checklist to Audit Payroll Processes to Avoid Costly Mistakes — Payroll mistakes can be costly, if your company fails to comply with changes in the tax code. To avoid issues with the Department of Labor or the Internal Revenue Service, it’s best to review your payroll processes.
HR – Compensation Strategies to Retain High Performers — Two of the most salient steps you can take in management – create a compensation plan that competitively pays your employees and rewards them for excellence. Enlightened compensation plans inspire performance and incentivize productivity.
“People are still willing to do an honest day’s work. The trouble is they want a week’s pay for it.”