Issue: Many employers are baffled about how to paywhen they travel locally or on overnight trips.
Risk: Mistakes could spark anything from mild complaints to class-action lawsuits, a black eye for you either way.
Action: Use the following case study and tips to learn how to pay traveling workers the correct way.
You don't need to pay hourly employees for commuting to and from your workplace. That's simple. But what if such employees occasionally travel off-site for work reasons?
The Fair Labor Standards Act () sets rules on compensating hourly employees for travel time. The best way to decipher them is using a case study:
Home-to-work time. Let's say Robert is a nonexempt employee who sometimes travels for work. While you don't need to pay for his commute to work, what if he stops along the way to pick up some company documents?
In that case, you'd pay him from the time he picks up the plans. The law says that if the travel is for the company's benefit, you must pay for the time. If it's purely commuting, it's not compensable.
Working at different locations. Say Robert reports to headquarters before making his rounds to visit other company locations. In that case, his commute to headquarters is nonpaid commuting time, but all travel from headquarters until his last stop is paid time. Time from the last stop to home is unpaid commuting time.
Day trips. Generally, travel time on work-related day trips is counted as paid time, except for meal times.
Example: Robert drives to the airport and takes a 6 a.m. plane to a seminar in Chicago. He arrives at 8:30 a.m. and takes a cab to the seminar. The seminar runs from 9 to 5, with an hour lunch break. After the seminar, he chats with friends for an hour before taking a cab back to the airport. He flies back to his base city and drives home.
What counts as "compensable" time?
You don't have to pay Robert for his drive to the airport; that's commuting time. But you do have to pay him from the time he arrives at the airport through his flight, cab ride and during the Chicago seminar. (You don't have to pay for his lunch period.)
Do you pay for Robert's chatting time with friends? If there are no other flights home until later, yes. But if Robert simply opts for a later flight to swap stories with his buddies, the answer is "No."
The cab back to the Chicago airport and the flight home are paid time. The drive home from the airport is considered commuting time.
Online resource: For more advice, see the U.S. Labor Department's fact sheet, Hours Worked Under the FLSA, which addresses when to pay for on-call hours, sleep time, rest breaks, travel time and more. Go to www.dol.gov/esa/regs/compliance/whd/whdfs22.htm.