The Fair Labor Standards Act (FLSA) requires that nonexempt employees are paid for ALL time worked. It is the tracking of this time that becomes the basis for payment of overtime. The requirement under the FLSA is that nonexempt employees are paid overtime for all hours worked that exceed 40 hours in a week. Seems simple enough, but there are some wrinkles that often cause problems. One of these areas is lunch time and that becomes even more problematic with telecommuting employees.
Under the FLSA there actually is no requirement that employers provide a meal time. That varies under state law, but under federal law you do not have to give employees time to eat. That is not necessarily good HR but is often found in 24 hour operations. If you do provide a meal break in order for it to be non-compensated time the employee must be fully relieved of any work duties during that meal break. In an industrial setting that is easier to control because you have the worker move away from the workstation and go to a break room, lunch room or cafeteria to have their meal. In smaller companies and in office situations often you will find someone eating their lunch at their desk.
When eating at a desk the employee may often answer an email or the phone during their meal break. That is fine if the employee is an exempt employee, not so fine if the employee is a nonexempt employee because they have just entered the realm of “not being fully relieved of their duties”. Not being fully relieved means that the time is now compensable. An hour lunch spent working five days a week adds up to five hours of overtime per week or 260 hours per year. That overtime bill can get expensive. The solution to this is that you must make sure that employees remove themselves from their workstation if you are not willing to pay for that overtime. If they stay then it must be recorded as time worked. But what do you do when they are not working in the office.
Telecommuting and the lunch break
If you have a nonexempt employee who works from home a portion of the week or even the entire week you are responsible for all the work hours the perform. If you have someone who is working on the computer it is an easy trap to fall into of grabbing a sandwich and coming back and sitting at the computer and continuing to work. If they are nonexempt they are then not fully relieved of their duties and that act of eating while at the computer is compensable time.
How to handle
Many companies have tight overtime budgets. So if you are not prepared to pay overtime then you need to have some way to control it. Here are some steps you can take:
- Have a policy to require all nonexempt employees to take a lunch break away from their workstation unless specifically authorized.
- Make sure to have a method to be able to track work time; in the case of telecommuters, when they are on the computer and working. You need to have some system to have them sign off for lunch and that no activity is shown on their computer for that specified meal break. You never know when someone may use those computer records against you to show that they worked all those hours and you didn’t pay them for it.
- Monitor adherence to the policy and deal with discrepancies in a very timely manner.
Of course there are other solutions to this as well. These include:
- Don’t have nonexempt employees telecommute.
- Be very careful in your selection of people designated for telecommuting. Make sure they have the work ethic, understand the rules and can be relied on to abide by them.
- Don your rose colored glasses and don’t worry about it. Keep repeating the mantra “My employees love working here and would never do anything that is not in the best interest of the company.”
One of the key components in this equation is the supervisor. Companies often get sued not due to the actions of their employees but rather due to the actions of supervisors. Supervisors are the ones that get hammered on overtime budgets. They also have to understand the rules on overtime payment and making sure time is appropriately and accurately recorded. They need to understand that making telecommuter “work off the clock” is as wrong as it is to have someone stay in the office working off the clock.
I know some of this sound Draconian and too much like a “police state.” Unfortunately until the FLSA is amended to catch up to the realities of today’s workers you are still obligated to abide by the current law. So paying overtime as required may add to your budget, but it will not be nearly as bad as paying back pay, lawyer’s fees and fines when you get caught. And the DOL is making it easier for you to get caught.