On April 12, 2018, the United States Department of Labor issued three opinion letters that provide guidance on how employees without "normal working hours" should be compensated for travel time involving an overnight stay, whether rest breaks provided as a reasonable accommodation are compensable, and what forms of lump-sum payments can be garnished for child support. In addition, the DOL issued a fact sheet detailing when teachers, coaches, and other professionals who work at higher education institutions should be paid overtime.
The first opinion letter, FLSA2018-18, confirms long-standing DOL positions regarding when travel time is compensable under the Fair Labor Standards Act (FLSA) (e.g., hotel to worksite travel is a normal non-compensable commute). However, the letter also addresses a nagging issue that has remained unsolved for many years: For employees with irregular schedules, how do you determine their "normal work hours" during which they must be paid when travel requires an overnight stay? This letter provides employers with two different methods to reasonably ascertain an employee's normal work hours, and determine whether travel time is compensable. The employer may review the employee's time records during the most recent month of regular employment and use the average start/end times during that time period. Employers also may negotiate with the employee or employee's representative and agree to what constitutes the employee's normal work hours. If employers use either of these methods, the DOL will not find FLSA violations when employees are not paid for travel time occurring outside these normal working hours on work or non-work days.
In the second letter, FLSA2018-19, the DOL clarifies that rest breaks given by an employer to accommodate an employee's serious health condition predominantly benefit the employee and are not compensable as a result. This ruling provides an exception to the current FLSA regulations, which state that employees must be paid during rest breaks of 20 minutes or less. The DOL opined that a 15-minute rest break each hour that was certified by a health care provider due to the employee's serious health condition—and therefore covered by the Family and Medical Leave Act (FMLA)—was not compensable time under the FLSA. Notably, employees that take FMLA-protected breaks as an accommodation must still receive as many paid rest breaks as their coworkers.
The third letter, CCPA2018-NA, considers whether certain lump-sum payments are considered "earnings" for purposes of the garnishment limitation in Title III of the Consumer Credit Protection Act (CCPA). In determining whether certain lump-sum payments are earnings under the CCPA, the opinion letter articulates the central inquiry: Whether the employer paid the amount in question for the employee's services. The letter specifically analyzes 18 types of lump sum payments, including commissions, bonuses, profit-sharing payments, relocation payments, awards, retroactive merit increases, holiday pay, termination pay, and severance pay. The letter specifies that lump-sum payments for workers' compensation, insurance settlements for wrongful termination, and buybacks of company shares do not constitute "earnings" under the CCPA.
Finally, Fact Sheet 17(s): Higher Education Institutions and Overtime Pay Under the Fair Labor Standards Act (FLSA), discusses the applicability of the "white collar" exemptions common in higher education institutions. More specifically, this Fact Sheet lists the following positions as typically exempt under the FLSA: (a) part-time teachers; (b) teachers who teach online or remotely; (c) teachers who spend a "considerable amount of time" in extracurricular activities (e.g., coaching); and (d) athletic coaches employed by higher education institutions. The Fact Sheet also determines that the "learned professional exemption" applies to: (a) certified athletic trainers; (b) librarians; and (c) post-doctoral fellows. Further, the administrative exemption applies to: (a) admissions counselors; (b) student financial aid officers; (c) department heads; (d) intervention specialists; and (e) academic counselors. Finally, the Part 541 exemptions apply to the following student-employees if they meet the salary tests: (a) graduate teaching assistants; (b) research assistants; and (c) student residential assistants.
Perhaps more significant than the content of the new opinion letters themselves is the DOL's willingness to begin issuing opinion letters even though Cheryl Stanton, President Trump's nominee to head the Wage & Hour Division, has still not been confirmed by the Senate. These letters, and the recent announcement of its new PAID self audit program, signals that the DOL is no longer waiting for Stanton's confirmation to begin providing employers much-needed assistance and guidance for complying with the FLSA and other laws it enforces.
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