On the clock, or off the clock—that is the question. In other words, what actually counts as work? While it’s no secret that wage-and-hour rules can be convoluted, the Fair Labor Standards Act (FLSA)’s provisions here are surprisingly clear. For hourly or nonexempt employees, time spent doing even the most unassuming task could be considered compensable. Skimming work emails while on vacation? Check. Traveling to a conference? Maybe.
We’ve broken down the four most common scenarios where seemingly off the clock actions actually count as hours worked.
Whether it’s an in-house training program or a requirement to attend an off-site lecture, learning and development opportunities generally count as compensable work. Luckily, the FLSA offers an easy-to-use test for determining when employers actually need to pay out.
For a training activity to not be considered working time, it must meet all of the following criteria:
Attendance is optional
The activity is not directly related to the individual’s job
The employee does not perform any of their regular duties during the activity
The activity takes place outside of regular working hours
Still unclear? Here’s the gist: if you require employees to attend a training, webinar, or similar activity, attendance is generally considered work. Since even the slightest encouragement can be interpreted as a mandate, managers should always make it clear whether attendance is voluntary. This approach saves your HR and payroll teams from compliance issues, as well as employees from the disappointment of learning last night’s boring roundtable wasn’t compensable.
Sorry to disappoint you—a morning commute to the office doesn’t count as time worked. That being said, there are a number of occasions where the FLSA requires employers to pay-up for travel.
If an employee is traveling at their employer’s direction during work hours (e.g., from jobsite to jobsite), that counts as time worked. Additionally, if an employee is commuting for a special one day assignment to another location, that time is also considered work, with one caveat: the employer is permitted to deduct the individual’s typical commute time from the sum. Here’s an example:
Sarah works in New York City and typically has a 30 minute commute. Her employer has sent her to a special meeting in Albany.
Each way, it takes 2½ hours for Sarah to make the meeting, amounting to 5 hours of total travel time. If the employer so chooses, it may deduct an hour from Sarah’s billable hours to account for her typical commute to and from work.
What about cases where travel spans multiple days? The rules are less intuitive here. Regardless of whether the travel falls on a usual workday, employers must compensate employees for time spent traveling during their usual working hours. If an employee typically works from 9:00 AM to 5:00 PM, for example, they’d need to be paid for any travel that takes place between those hours. In this instance, a flight lasting from 7:00 AM to 12:00 PM would result in 3 billable hours for travel.
Note that federal law does allow your company to set a separate rate of compensation for travel time, so long as it exceeds the minimum wage and the employee has consented to it. You can learn more about those rules here.
We’ve all heard how obsessively checking emails after work can contribute to burnout. Last year, France even went as far as to enact a law protecting the “right to disconnect.” When dealing with nonexempt workers, though, it's much more than a work-life-balance concern. Something as seemingly harmless as skimming work emails on vacation, believe it or not, poses serious compliance risks.
Federal regulations define employment as to “suffer or permit to work”—a broad definition that means any work, even if not expressly requested, is still considered payable. In short, an employee checking emails on his or her own time is legally considered compensable. Additionally, any form of after-hours correspondence, whether it be in-person or electronic (phone calls and texting count, too) related to work should be paid for.
There are number of policy approaches HR can take to avoid payroll compliance issues later on. First, be sure to remind nonexempt workers during onboarding that they should not be working off the clock without prior approval from their manager. If you don’t have this point included in your handbook already, strongly consider adding it.
It’s not just nonexempt behavior you’ll need to supervise, though. Managers sometimes inadvertently invite off the clock work by sending after-hours correspondence. Train managers to refrain from sending emails or making calls outside of business hours or during an individual’s vacation. While advocates of “work-life integration” may balk at the idea, coaching managers to clearly delineate work and personal time can trickle down and positively affect nonexempt employee behavior.
Sorry to spoil your appetite: while the FLSA doesn’t require employers to offer lunch (states and cities have filled that role), it has strict provisions for those who do. Call it the “20 minute rule”—if a break lasts 5-20 minutes, it must be considered compensable time. Anything more than that, and the break is considered a “bona fide meal period” under DOL rules and doesn’t need to be paid for.
The above covers what employers need to know at the federal level, but keep in mind that states and cities often have their own, more stringent provisions. In Massachusetts, for example, employers are required to provide workers with a 30 minute meal break for shifts lasting over six hours. In cases where federal and state laws contradict, you’ll need to take a different approach—read about that here.
As the old adage goes, “time is money.” When it comes to overtime compliance, time spent doing things we don’t typically consider work (like traveling or even cleaning up our inbox) is technically still compensable. Knowing this matters more than ever before. The number of wage-and-hour lawsuits filed per year has ballooned in the last decade and a half, going from just 1,935 filed in 2000 to 8,300 in 2016—a 330 percent increase.
Don’t find your company in the headlines. Regularly audit overtime classifications and continually remind nonexempt workers of what counts as hours worked. You’ll save yourself, and your company, from a payroll compliance nightmare down the road.
For more information on calculating overtime and payroll in general, take a look at our Payroll Guide.