Skip to Content

Wage and Hour Update: Compensating Employees for Voluntary Training Programs and Travel Time

on Monday, 9 November 2020 in Labor & Employment Law Update: Kara E. Stockdale, Editor

Amidst the hustle and bustle of Election Day, the Department of Labor’s Wage and Hour Division (the “WHD”) issued two opinion letters regarding the application of Fair Labor Standards Act (“FLSA”) compensation requirements. While most employers are aware that the FLSA requires them to compensate employees for their “work,” it is not always easy to determine which employee activities constitute work and which do not. The WHD’s opinion letters offered guidance as it relates to (1) the compensability of time that employees spend attending voluntary training programs and (2) the compensability of non-exempt construction workers’ travel time between the employer’s business and job sites.

Voluntary Training Programs

Many employers today offer voluntary continuing education benefits to their employees as a way to reduce overall training costs, increase employees’ skills or productivity, or merely to help the employee retain necessary licenses to continue his or her job. But employers must beware—some of the time employees spend in these training opportunities may be compensable.

The first opinion letter reminds of the general rule that an employer does not have to pay an employee for attendance at “lectures, meetings, training programs and similar activities” if:

  1. Attendance is outside of the employee’s regular working hours;
  2. Attendance is in fact voluntary;
  3. The course, lecture, or meeting is not directly related to the employee’s job; and
  4. The employee does not perform any productive work during such attendance.

However, the regulations also address two “special situations” in which such training may not be compensable even though it directly relates to an employee’s job:

  1. Voluntary attendance outside of work hours in an program of instruction established by the employer that “corresponds to courses offered by independent bona fide institutions of learning”; and
  2. Attendance, after hours, on the employee’s own initiative in an independent school, college or independent trade school.

In the opinion letter, the WHD examined the compensability of time spent in training programs under six different factual scenarios.  Here are some of the key takeaways from its analysis:

  • Whether an on-demand webinar is being offered by the employer or another entity, it may still qualify for the first “special situation” as long as it corresponds to courses offered by independent bona fide institutions of learning—for example, a course that can satisfy a professional licensing requirement.
  • Even if it did not satisfy the licensing requirement, the WHD would consider the webinar to be similar to an independent bona fide institution of learning so long as the course content is not tailored to the peculiar requirements of a particular employer nor the particular job held by an individual employee.
  • The fact that an employee could have participated in a training during work time does not make it compensable under these “special situations.” Conversely, that an employee could have participated outside of work time does not make it not   What matters is when the employee actually participated—if during regular work hours, it is work under the FLSA.
  • An employer may establish a policy prohibiting attendance at training programs during regular work hours.
  • If the time spent in a training program falls under one of these special situations and therefore need not count as hours worked, the time spent traveling to such training programs “would be similarly excludable as personal travel time.”

Travel Time

Common wage and hour questions among employers include when they must pay for an employee’s travel time, such as (1) to and from the employer’s location, (2) to local or remote worksites, and (3) driving employer’s vehicles. In the second opinion letter the WHD responds to three different factual scenarios, analyzing how the regulations apply to each situation.  Though the scenarios were specific to the construction industry, the takeaways from the analysis would apply in most employment situations:

  • An employee’s ordinary home-to-work travel is generally not compensable. This includes travel from the employee’s home to an employer’s principal place of business or a local worksite.
  • An employee’s decision to ride as a passenger in employer-provided transportation to a local worksite, if not required, is not automatically compensable.
  • If an employer requires an employee to meet at a designated place before traveling to a worksite, the travel time between the designated place and worksite is likely compensable if the employee starts an activity that is integral to the employer’s operations before the travel begins. For example, an employee’s requirement to drive a construction employer’s truck to and from a worksite might be integral to the employer’s operations.
  • If a worksite is farther away than an employee’s ordinary home-to-work travel, such as a place requiring an overnight stay, the additional travel might be compensable if it is done during the employee’s normal working hours. This is true even when the travel occurs on a non-work day.
  • An employer can provide a public or employer-provided transportation option to employees to travel to remote worksites as a passenger. If the employee decides to use this option, the travel time is compensable to the extent it cuts across the employee’s normal working hours. Again, this is true even when the travel occurs on a non-work day.
  • If an employer provides employees with a public or employer-provided transportation option and the employee decides to travel in his or her own method of transportation, the employer can decide whether to pay the employee (1) the compensable time the employee spent traveling to the worksite, or (2) the compensable time the employer would have had to count if the employee had used the offered transportation.
  • If an employee is staying at a hotel when completing work in a remote location, the travel between the hotel and worksite is ordinary home-to-work travel and not compensable.

None of the wage and hour rules listed in these opinion letters are new. Yet, the fact that the WHD continually gets requests for opinion letters from employers seeking help in evaluating their FLSA compliance in certain situations, not to mention the fact-specific analysis WHD undertakes in providing a response, shows how complicated and difficult compliance continues to be.   

1700 Farnam Street | Suite 1500 | Omaha, NE 68102 | 402.344.0500