When is Travel Time Paid?
By Stacey Sommerhauser, SPHR-CA, SHRM- SCP
We often receive questions from CA employers regarding when to pay non-exempt (hourly) employees for travel time. Here’s a “quick and dirty” reference to begin to understand the complexities of this additional compensation requirement.
With the exception of travel from home to work and back, most travel time is considered work time. However, because traveling does not require the employee to employ his/her skills, pay for travel time may be at a rate of pay that is less than the employee’s normal rate of pay. The employer is permitted to pay the employee as little as the minimum wage for travel pay, subject to the following conditions:
- Travel time is counted as work time, and thus overtime may be due for travel;
- Travel time pay, if less than the employee’s normal earnings, is clearly outlined to all employees in advance, preferably as part of your personnel policy; and
- You reimburse the employee for all out-of-pocket travel expenses in addition to the hourly rate of pay.
If travel time in either direction or travel time plus work time exceeds eight hours in a workday, the employee must receive travel pay at one and one-half times the regular pay rate. This regular rate of pay overtime calculation can be tedious if the employee is paid at different rates of pay in the pay week. You may save money paying travel at a lower rate, but the overtime calculation may cause you to rethink that strategy.
The following shows what travel time is and is not considered “work time” for non-exempt employees and if it will be paid:
|Travel Time||For CA Non-Exempt Employees|
|Travel to and from regular place of employment at beginning or end of workday||Not work time — Not paid|
|Travel to and from alternate worksite if employee regularly works at one site||Employee is paid for work time for the travel time that exceeds the usual home-to-work commute time|
|Travel to and from worksite at the beginning and end of the day within normal service area for employees who regularly work at different sites||Not work time — Not paid|
|Travel back and forth to places of employment or alternative worksite when required after a day’s work, including air, auto or train time||Work time — Paid|
|Travel to airport, train depot, etc., when in lieu of normal home-to-office commute at beginning or end of day||Work time — Paid|
|Travel to airport, trait depot, etc., when part of workday, i.e., travel from one worksite to another||Work time — Paid|
|Travel as part of a workday, i.e., travel from one worksite to another||Work time — Paid|
|Travel from airport, train depot, etc., to hotel or home after arrival in/from an alternative worksite city||Work time — Paid|
And if you haven’t had enough – here’s more research from the desk of an HR Nerd….
Exempt employees are not paid beyond their weekly salary for travel time.
When an employee is required to travel to distant work locations, the time spent traveling is compensable. Even in circumstances where there is some reasonable expectation that the job will require some travel, unreasonable extended travel is usually compensable. In some circumstances you can deduct an employee’s regular commute time from total travel time (See Silvers HR Travel Time chart attached) The Department of Labor Standards and Enforcement’s (DLSE) Opinion Letter “Travel Time Pay for Employee with Alternative Worksites” dated April 22, 2003 is a helpful reference. Page 3 of the Opinion Letter specifically references construction worksites that are in distant locations.
Additionally, we recently spoke with a Deputy Labor Commissioner who stated the employer will want to consider if the employee has been instructed to use a company vehicle. In those cases, all time spent traveling is compensable time and there is not credit to the employer for the regular commute. However, if the employee has an option to drive a company vehicle or use his/her personal vehicle, commute in the regular commute area is not compensable.
In addition, the Department of Labor Standards and Enforcement Manual offers further guidance from the DLSE as it relates to travel time:
46.2 Travel Time. If an employee is required to report to the employer’s business premises before proceeding to an off-premises work site, all of the time from the moment of reporting until the employee is released to proceed directly to his or her home is time subject to the control of the employer, and constitutes hours worked. (O.L. 1994.02.16; Morillion v. Royal Packing Co. (2000) 22 Cal.4th 575).
46.3 Extended Travel Time. The California rule requires wages to be paid for all hours the employee is engaged in travel. The state law definition of “hours worked” does not distinguish between hours worked during “normal” working hours or hours worked outside “normal” working hours, nor does it distinguish between hours worked in connection with an overnight out-of-town assignment or hours worked in connection with a one-day out-of-town assignment. These distinctions, and the treatment of some of this time as non-compensable, are purely creatures of the federal regulations, and are inconsistent with state law. (O.L. 2002.02.21).
46.3.1 Under state law, if an employer requires an employee to attend an out-of-town business meeting, training session, or any other event, the employer cannot disclaim an obligation to pay for the employee’s time in getting to and from the location of that event. Time spent driving, or as a passenger on an airplane, train, bus, taxi cab or car, or other mode of transport, in traveling to and from this out-of-town event, and time spent waiting to purchase a ticket, check baggage, or get on board, is, under such circumstances, time spent carrying out the employer’s directives, and thus, can only be characterized as time in which the employee is subject to the employer’s control. Such compelled travel time therefore constitutes compensable “hours worked.” On the other hand, time spent taking a break from travel in order to eat a meal, sleep, or engage in purely personal pursuits not connected with traveling or making necessary travel connections (such as, for example, spending an extra day in a city before the start or following the conclusion of a conference in order to sightsee), is not compensable. If the employee’s travel from his home to the airport is the same or substantially the same as the distance (and time) between his home and usual place of reporting for work, the travel time would not begin until the employee reached the airport. The employee must be paid for all hours spent between the time he arrives at the airport and the time he arrives at his hotel. No further “travel” hours are incurred after the employee reaches his hotel and is then free to choose the place where he will go. (O.L. 2002.02.21)
46.3.2 Different Pay Rate For Travel Time Permissible. The employer may establish a different pay scale for travel time (not less than minimum wage) as opposed to the regular work time rate. The employee must be informed of the different pay rate for travel before the travel beings. For purposes of determining the regular rate of pay for overtime work under the circumstances where a different rate is applied to travel time, the State of California adopts the “weighted average” method. (See Section 49.2.5 of this Manual; see also O.L. 2002.02.21).
We encourage you to contact your employment attorney or HR consultant when setting up a travel time policy.
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