According to the Fair Labor Standards Act (FLSA), employers must keep track of and pay employees for all time worked. But what exactly counts as time worked? This question is somewhat loaded, requiring employers to work through a myriad of federal and state laws and regulations, as well as a number of fact-specific exceptions. For instance, are employees entitled to payment for engaging in passive activities, such as participating in meetings or training courses, traveling for work or changing clothes?
We will address some issues these questions typically raise. But the guidance we provide is based on fairly fact-specific regulations and limited to federal law. It is important you consult legal counsel to fully understand the regulations and ensure no applicable state or local laws mandate a different outcome. It also is important to note these rules apply only to nonexempt employees (employees who are entitled to overtime compensation pursuant to applicable law).
According to FLSA, time worked includes not just time an employee is asked or required to work but also time the employee is "suffered" or "permitted" to work. For example, an employee may voluntarily continue to work at the end of his shift or scheduled workday with or without authorization. He may want to finish a job or save time and effort the following day. The reason for the extra time is immaterial, and it does not matter whether the time was authorized. If the employer knew or had reason to know of the extra time (whether by seeing or hearing of the employee performing the work, seeing the product of the work, receiving the time reported on a time sheet or time clock, or other means), it is considered time worked, and the employee must be paid at his regular or, as applicable, overtime or premium rate.