On April 12, 2018 the Department of Labor released three new opinion letters on the Wage and Hour Division’s website. The three opinions were the first letters the Department has released in nearly a decade.1
Two of the letters concern the application of the Fair Labor Standards Act. Specifically, the two FLSA letters address:
(1) what counts as “work” when employees travel for work, and
(2) whether an employer must pay for an employee’s hourly 15-minute rest breaks necessitated by the employee’s serious health condition.
The third letter addresses whether certain lump-sum payments from employers to employees are con sidered “earnings” for garnishment purposes under Title III of the Consumer Credit Protection Act.
The two FLSA letters are summarized below.
WHD Opinion Letter FLSA 2018-18 (April 12, 2018)
In opinion letter FLSA 2018-18, the employer, a crane repair company, asked the WHD whether travel time was compensable under the FLSA in three different scenarios. “The principles which apply in determining whether or not time spent in travel is working time depends on the kind of travel involved.” 29 C.F.R. 785.33. In the first scenario, the travel involved employees traveling away from their home communities. In the second and third scenarios, the travel involved ordinary commuting to and from work.
FLSA regulations provide that “[t]ravel away from home is clearly worktime when it cuts across the employee’s workday. The employee is simply substituting travel for other duties.” 29 C.F.R. 785.39. Travel away from the home, outside regular working hours, as a passenger on an airplane, train, boat, bus, or automobile is not worktime. Id.
The crane company claimed that its employees did not have a fixed daily schedule. In its response to the first scenario, the WHD warned that it “carefully scrutinizes claims that employees have no regular or normal working hours.” It explained that in its experience, reviewing time records usually reveal “work patterns sufficient to establish regular work hours.”
After warning the crane company of its hard-look policy, the WHD presented two methods employers may use to “reasonably ascertain an employee’s normal work hours” for determining compensable travel under the FLSA.
In the first method, the employer reviews the most recent month of regular employment to determine if it reveals typical work hours. If it reveals typical work hours, then the employer may consider those hours as the normal hours going forward unless there is a material change in circumstances. If the review of the most recent month does not reveal typical work hours, then the employer may choose the average start and end times for the employees’ workdays.
In the second method, if the employee truly lacks typical work hours, then the employer and employee may agree to a reasonable amount of time or timeframe in which travel outside of the employee’s home community is compensable.
The WHD explained that there are other permissible methods for determining an employee’s typical workday for travel purposes. If employers reasonably use these methods to determine typical working hours for determining what travel time is compensable, then the WHD will not find a violation for paying employees’ travel only during those working hours.
In the second and third scenarios, the crane company inquired about ordinary commuting. The WHD restated the general rule, which is found at 29 C.F.R. 785.35: “Normal travel from home to work is not worktime.” This general rule applies even where an employee works at different job sites. But the WHD explained, travel between job sites after arriving to work is compensable. 29 C.F.R. 785.38.
WHD Opinion Letter FLSA 2018-19 (April 12, 2018)
In opinion letter FLSA 2018-19, employees required 15-minute breaks every hour due to their serious health conditions. The frequency of the breaks meant that in an eight-hour shift, the employees would perform only six hours of work.
The question for the WHD was whether these 15- minute breaks were compensable worktime under the FLSA. The WHD answered “no.”
Quoting Armour & Co. v. Wantock, 323 U.S. 126, 133 (1944), the WHD explained, “the compensability of an employee’s time depends on ‘whether [it] is spent predominantly for the employer’s benefit or for the employee’s.’” Short rest breaks up to 20 minutes generally benefit the employer because they promote efficiency, are common in the workforce, and reenergize the workforce. Because short rest breaks up to 20 minutes predominately benefit the employer, they are ordinarily compensable. See 29 C.F.R. § 785.18.
But in limited circumstances, the WHD explained, short rest breaks primarily benefit the employee and are thus non-compensable. The WHD opined that because the short rest breaks were for accommodating the employees’ serious health conditions, they were predominantly for the benefit of the employees. So the FLSA did not require the employers to pay the employees for the breaks. The WHD relied on Spiteri v. AT&T Holdings, Inc., 40 F. Supp. 3d 869 (E.D. Mich. 2014) and Sec’y United States Dep’t of Labor v. Am. Future Sys. Inc., 873 F.3d 420 (3d Cir. 2017) in reaching its opinion.
Readers should expect to see more opinion letters posted on the WHD website in the near future.
—END NOTE— 1 In January, the department reissued 17 Bush-era opinion letters.
Published in Labor & Employment Lawnotes Vol. 28, No. 2
