Are You Paying Employees Correctly? The Travel Time Rule You Can’t Ignore!

The Fair Labor Standards Act has been known to trip up HR professionals and employer lawyers, too. Payment for travel time, for example, can have several variables, such as when, where, why, and how. However, a recent Third Circuit decision clarified when, if ever, an employee’s travel time between client sites is compensable.

I’ll spare you the court’s FLSA minutiae and reduce it to a 60-second plain English read for you and your colleagues.

Key Takeaways from the Court’s Decision:

1. Travel During the Workday Must Be Paid
   If employees travel from one job site to another during their shift, that time counts as work hours. The court explained that the Portal-to-Portal Act, which excludes some travel from paid time, does not apply to travel that happens during the workday. Travel between job sites should be considered part of an employee’s continuous workday.
2. Travel as a Necessary Part of the Job
   The court used the “integral and indispensable” test, which asks whether an activity is essential to an employee’s main job duties. In this case, the court found that home healthcare aides must travel between clients’ homes to do their job, making that travel time necessary and, therefore, compensable. However, personal travel—such as stopping for errands or detouring for non-work-related reasons—is not compensable.
3. Employer Control and Benefit
   The court emphasized that compensable travel time includes travel required by the employer and undertaken primarily for the employer’s benefit. If an employee is required to transport work-related materials, equipment, or other employees between job sites, that travel time must also be compensated. The court clarified that even if an employee has some flexibility in scheduling or choosing routes, the necessity of the travel for completing work duties still makes it compensable.
4. Short Breaks and Waiting Time
   The ruling also touched on compensable waiting periods. If an employee is waiting for transportation between job sites as part of their work responsibilities, this time must be paid. Similarly, short rest periods of 20 minutes or less that occur between job-related travel must also be counted as work time.

What Employers Should Do:

1. Track Time Accurately
   Make sure your time-tracking system records all travel that happens during the workday. Employers should also establish a clear policy for employees to log travel time separately from non-compensable personal travel.
2. Review Your Policies
   Check your policies to ensure they comply with this ruling. Update your employee handbook and training materials as needed. In their written policies, employers should clarify distinctions between compensable work-related travel and non-compensable personal travel.
3. Communicate with Employees
   Clearly explain to employees what counts as paid travel time and how to log it correctly. This helps prevent misunderstandings and ensures compliance. Consider providing specific examples of compensable and non-compensable travel scenarios to ensure employees understand their rights and responsibilities.

If you’ve been ignoring travel time rules, now’s the time to change course—before your payroll practices take you on a detour to court.