April 17, 2018

April Snow Brings Employers Flurry of FLSA Guidance

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April is already 17 days old and Washington D.C. is still under threat of snow – but bad weather has brought with it a flurry of action surrounding the Fair Labor Standards Act (“FLSA”). In addition to the United States Supreme Court’s big ruling that Service Advisors at automotive dealerships are FLSA exempt, the Department of Labor (“Department”) also recently issued two opinion letters confirming and clarifying details of the FLSA.

Opinion Letter Program Revived

Opinions letters are official statements of the Department’s Wage and Hour Division’s (“WHD”) policy, usually made in response to an inquiry from an employer.  The practice of issuing opinions letters was revived in June 2017, after the 70-year practice was temporarily halted in 2010. This year, the WHD has issued 19 opinion letters concerning topics under the FLSA.  This round of letters, issued April 12, 2018, discusses whether short breaks offered as an accommodation under the Family Medical and Leave Act (“FMLA”) are compensable (FLSA2018-19), and what types of employee travel time is compensable (FLSA2018-18).

Are FMLA Breaks Compensable?

With regards to FMLA-accommodation breaks, the Department reiterated that such breaks may be unpaid under the FMLA, and are non-compensable time for FLSA purposes – such as calculating FMLA eligibility and overtime wages. Typically, rest breaks of up to 20 minutes are considered “primarily for the benefit of the employer,” and are generally compensable working time under the FLSA. By contrast, breaks taken to accommodate serious health conditions are “primarily for the benefit of the employee,” making them non-compensable time. The Department cautioned that employers cannot treat accommodated employees differently than non-accommodated employees. Generally, that means the employer must credit the accommodated employee with the same number of paid rest breaks as non-accommodated employees.

In California, Labor Code Sections 226.7 and 1198, and related Wage Orders mandate that employers provide employees with a paid, ten-minute break for every four hours of work or major fraction thereof.  Thus, breaks offered beyond this requirement – as an accommodation under the FMLA, or under California’s Fair Employment and Housing Act – may be unpaid, and do not count as compensable time under the FLSA.

What Travel Time is Compensable?

With regards to employee travel time, the Department confirmed that commuting time from an employee’s home to their work location, fixed or otherwise, is not compensable time under the FLSA – unless the amount of time is “extraordinary.” By contrast, time spent travelling between job sites is compensable, whether the employee uses an employer-owner vehicle or not. When an employee travels away from home overnight, the Department confirmed that such travel time is compensable where it cuts across the “employee’s [regular] workday.”  Perhaps of greatest significance, the Department also addressed how an employer could calculate an employee’s “regular workday” in occupations where start and end times may vary greatly, or in the rare instance where the employee truly has no fixed hours of work. Employers can calculate “normal work hours” by (1) reviewing the employee’s time records for the preceding month to see if typical work hours emerge; (2) average the employee’s start and end times for workdays during the preceding month; and (3) in the “rare case” that the employee truly has no normal work hours, the employer and the employee (or their representative) may negotiate and agree on a reasonable amount of compensable travel time for travel away from the employee’s home community.  This advice may be particularly helpful for California employers whose employees work on a client-call basis or where the majority of the employee’s duties are performed in the field.

Takeaway

While the new opinion letters offer little in the way of ground-breaking news, they are a good reminder that employers should periodically audit their pay practices – especially regarding travel time and accommodations for serious health conditions – to ensure they are FLSA compliant.

–Stefanie Renaud