Limits on comp time for exempt employees — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily

Limits on comp time for exempt employees

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Q. One of my managers had to work on a holiday, and the hourly employee who worked with him got double time in addition to the holiday pay. When the salaried employee wanted to take time off shortly afterward, my boss said it was not legal to give him comp time—he would have to be paid for the holiday he worked. The employee would rather have time off. Is there no comp time for anyone? —J.W., North Carolina

A. While state and local government employers can offer comp time off in lieu of overtime pay, private employers can use it only under very limited circumstances. The Labor Department and most courts that have ruled on the issue permit the use of comp time for exempt private-sector employees. (It's never permissible, however, to use comp time for nonexempt private-sector workers.)

Use caution in offering comp time even for exempt employees, however. If you give one hour of comp time for every hour worked over 40, you run the risk of destroying the exemption once it appears that the worker is really being paid by the hour.

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