The United States Congress enacted the Fair Labor Standards Act ("FLSA") for several purposes one of which was to govern and regulate the hours worked by and wages paid to workers. The FLSA sets minimum wages to be paid to employees for overtime work. In setting this minimum, the FLSA imposes definitions and regulations upon employers that you must understand and consider when establishing your payroll system. These definitions include travel time so it is important for you to understand when travel time is considered working time by the FLSA.

Because of the penalties for failure to comply with the FLSA, such as double damages, it is important for you to monitor your employees' hours if you desire not to pay overtime. Recent trends in the economic expansion of the 1990s indicate that employers have become comfortable with providing overtime to regular workers rather than hiring new workers to avoid paying overtime. If you have employees who do work overtime, it is imperative that you know the mandates of the FLSA.

FLSA Requirements

The FLSA categorizes workers into exempt and nonexempt workers. Generally employees earning an hourly wage are considered nonexempt employees. This articles focuses on non-exempt employees and the wages to be paid to them under the FLSA. It is important to note that Connecticut law includes other exempt or nonexempt requirements but these requirements are generally less stringent than the FLSA. Therefore, it is imperative that you understand the requirements concerning non-exempt workers under the FLSA.

You are required to pay nonexempt employees time and one-half for all time worked in excess of forty hours in one workweek. The FLSA uses a single workweek as its standard and does not permit the averaging of hours over more than one to determine whether a nonexempt employee is entitled to overtime. Therefore, if any nonexempt employee works more than forty hours in any one week, then that nonexempt employee must be paid time and one-half for work over the forty-hour limit to comply with the FLSA.

How do you determine the amount of hours worked by your employees for purposes of the FLSA? The FLSA analyzes "hours worked" to determine when an employee is entitled to overtime pay. The Department of Labor has implemented a broad definition of "hours worked." While this definition is very broad its essence means that anything being done by an employee for the benefit of an employer – including waiting and/or travel time – is considered "hours worked." If an employer requires an employee to be at a site of employment at a certain time, even if non-work is performed, that time could be considered "hours worked." Obviously, this can have a drastic effect on the "hours worked" by your employees under the FLSA.

Travel Time – Hours Worked?

Travel time may or may not be considered "hours worked." Generally think about the analysis of "hours worked" mentioned above. If an employee must travel at your direction, then generally that time is "hours worked." Below are a few examples to help you in determining when you must pay for travel time.

Commuting. Commuting consists of ordinary home to work travel incident to employment. Commuting time is generally not considered "hours worked" even if it is done in a company car. However, it can be compensable if your employee is required to report to a different location in excess of the travel time to an employee's usual place of employment. Thus, if you require your employees to report to a site that is farther away from home than the employee's usual place of employment, then you must pay the employee for the additional travel time and you must calculate this time for overtime purposes under the FLSA.

Emergency Situations. As mentioned above, commuting is not considered "hours worked." However, if an employee has completed a regular workday and is called back to perform an emergency job then all time spent traveling to this emergency assignment is considered working time even if the emergency is at the employee's usual place of employment. Employees are not required to commute twice without compensation. The emergency response is required as part of the employment and because the employee has already commuted to and from work, the additional travel time is considered "hours worked."

Out of Town Work.

If you send an employee on a special out of town assignment the travel time is considered "hours worked." The travel time from home to the train station or the airport need not be considered "hours worked" because it is considered to be the same as home to work travel. However, the travel from the airport or train station is "hours worked" because it is performed to meet your needs.

Travel Away From Home. This means travel that keeps an employee away from home. Travel away from home is considered "hours worked" when it occurs during the employee's regular working hours on either regular working days or nonworking days. When analyzing these hours consider that meal time is not considered "hours worked" – unless you require employee to work during meal time – and time spent on an airplane or bus will not be considered "hours worked" if the travel occurs outside the employee's regular working hours.

Work Travel. Any time spent by an employee as part of his or her principal activity must be considered "hours worked." Travel between job sites during the workday is thus considered "hours worked." Whenever you require an employee to report to a site for any reason, such as receiving instructions or picking up supplies, then that travel time is considered "hours worked."

Conclusion

Some of these scenarios are simplistic and rather obvious. But the analysis can help you analyze more complex issues to protect yourself. It is important for you to fully understand the ramifications of the FLSA and to consider these issues when paying your employees. Generally, you will know rather easily when your employees are entitled to overtime pay. However, there are certain situations where the answer is not so clear and you need to be able to determine the answer quickly and correctly. Because of the significant economic penalties embodied in the FLSA, you should always be mindful of the FLSA's overtime requirements.

Reprinted with permission of publisher. First appeared in Connecticut Employment Law Letter (March 2002). For subscription information, call (800)274-6774.