The DOL’s Wage and Hour Division has issued a Field Assistance Bulletin (2020-5) "to clarify" employers’ obligation to track the number of hours of compensable work performed by employees who are teleworking or otherwise working away from premises controlled by their employers. As the DOL noted, telework arrangements have been expanding in response to the COVID-19 pandemic.
The guidance reaffirms that an employer must pay its employees for all hours worked, including work not requested but allowed and work performed at home. Where the employer knows or has reason to believe that an employee is performing work, the time must be counted as hours worked.
Confusion over when an employer "has reason to believe that work is being performed" may be exacerbated by the increasing frequency of telework and remote work arrangements since the Department last issued interpretive rules in 1961, according to the DOL.
Beyond coronavirus-prompted telework. Although the new guidance responds directly to needs created by new telework or remote work arrangements that arose in response to the pandemic, it also applies to other telework or remote work arrangements
Actual or constructive knowledge. The guidance notes, among other things, that an employer’s obligation to compensate employees for hours worked can be based on actual knowledge or constructive knowledge of that work. As to telework and remote work employees, the employer has actual knowledge of the employees’ regularly scheduled hours, and may have actual knowledge of hours worked through employee reports or other notifications. Under the FLSA, the standard for constructive knowledge in the context of overtime "is whether an employer has reason to believe work is being performed," according to the guidance.
Reasonable diligence. "An employer may have constructive knowledge of additional unscheduled hours worked by their employees if the employer should have acquired knowledge of such hours through reasonable diligence," the guidance explains. Here, the question is "what the employer should have known, not what ‘it could have known.’"
Reasonable process for reporting. One way to generally satisfy the obligation to exercise reasonable diligence to acquire knowledge about employees’ unscheduled hours of work is "by establishing a reasonable process for an employee to report uncompensated work time." However, the employer "cannot implicitly or overtly discourage or impede accurate reporting, and the employer must compensate employees for all reported hours of work," the guidance cautions.
Where an employee fails to report unscheduled hours worked through such a procedure, "the employer is generally not required to investigate further to uncover unreported hours," the guidance states. "Though an employer may have access to non-payroll records of employees’ activities, such as records showing employees accessing their work-issued electronic devices outside of reported hours, reasonable diligence generally does not require the employer to undertake impractical efforts such as sorting through this information to determine whether its employees worked hours beyond what they reported."
Unique challenges. "Due to the coronavirus pandemic, more Americans are teleworking and working variable schedules than ever before to balance their jobs with a myriad of family obligations, such as remote learning for their children and many others," said WHD Administrator Cheryl Stanton. "This has presented unique challenges to employers with regard to how to track work time accurately."
SOURCE: WHD Field Assistance Bulletin No. 2020-5, August 24, 2020.
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