When it comes to calculating overtime compensation and minimum wages, employers cannot simply mandate by policy when they consider their employees to be working. Instead, whether an employee is “on-the-clock” is determined by the rules and principles set out in the Fair Labor Standards Act, which is the federal law that governs minimum wage and overtime compensation. Common issues in calculating compensable time include:
Unscheduled Overtime Work
The FLSA does not require that an employer assign extra work or schedule an employee to work more than forty hours in a workweek for the employee to qualify for overtime pay. An employee who voluntarily stays late to perform work, or takes work home at night or on weekends, is performing work for the employer, and this time is considered compensable time for purposes of overtime and minimum wage calculations.
Idle Time and Being “On Call”
Time spent by an employee waiting for work is deemed compensable time, so long as the employee is ready and available to work. An employee who is “on call” at the employer’s worksite is generally considered “on-the-clock,” but an employee who is “on call” but free to go home or run errands is typically “off-the-clock.”
Rest and Meal Periods
Short rest periods, which are usually twenty minutes or less, are considered to be compensable time. An employer may only deduct an employee’s meal period if the employee has sufficient time to eat a meal without interruption. Generally, only meal periods that last longer than thirty uninterrupted minutes are considered compensable time. Although many employers automatically deduct thirty minutes for an employee’s meal period, workers do not have the opportunity to take a thirty-minute meal period, or who are interrupted during their meal break, are considered “on-the-clock.”
Time spent by employees traveling from one work site to another during the workday is considered “on-the-clock.” This rule begins once an employee has arrived at the first worksite for the day, so it does not include time commuting to and from work.
Mandatory Meetings, Training, Examinations, Charitable Work
Mandatory meetings and training classes must be included in an employee’s compensable time. Similarly, time spent at physical examinations, fingerprinting, and drug tests required by an employer is considered “on-the-clock.” Civic or charitable work is also compensable time when it is required by an employer.
“Docked” Time or Correcting Mistakes
Employers cannot “dock” an employee’s time for mistakes, misbehavior, or any other reason. Likewise, an employer cannot discount the time spent by an employee correcting mistakes.
As these applications of the rules show, if the time is spent for the benefit of the employer, and the employee is not free to use the time as he or she wishes, it is likely considered compensable time and should be included in an employee’s hours worked for purposes of calculating overtime compensation and minimum wages.