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Under the FLSA, when must nonexempt employees be paid for travel time?

The Fair Labor Standards Act (FLSA) regulations require employers to pay for travel time in some circumstances. Generally, time spent traveling is compensable, unless it is normal home-to-work commute time, or when travel requires an overnight stay and the time spent traveling as a passenger falls outside of the employee's normal work hours.

When pay is required, the time spent traveling is considered hours worked and must be included when determining overtime pay obligations. 

Home-to-work travel. Normal commuting time to an employee's regular worksite is not treated as hours worked under the FLSA.

Home to work on a special one-day assignment in another city . When an employee must travel out of town for work but returns home the same day, all the time spent traveling during the day is compensable, regardless of the employee's regular work hours. However, an employer may deduct the time the employee would have spent commuting to his or her regular work location.

Travel that is all in a day's work. Time spent traveling to and from different worksites during the day is work time and must be paid.

Travel away from home. When travel requires an overnight stay, any time traveling as a passenger that falls within the employee's normal work hours is compensable, regardless of what day of the week the travel takes place. Time spent traveling to an airport terminal or train station is considered commute time and is not treated as hours worked, but the time spent waiting at the terminal until arrival at the destination is compensable when it falls during normal work hours.

For example, if Meg normally works Monday through Friday, 8:30 a.m. to 5 p.m., and she is required to travel by plane on a Sunday for business in another state, her travel time on Sunday between 8:30 a.m. and 5 p.m. is compensable.

So, if Meg arrives at the airport on Sunday at 3 p.m. and at her destination at 8 p.m., the employer is required to pay her only from 3 p.m. to 5 p.m., the hours that correspond with her normally scheduled work hours.

Alternatively, if Meg drives herself or others at the direction of the employer rather than traveling as a passenger, all the time spent driving is compensable work time, regardless of Meg's normal work hours.

Driving at the direction of the employer . When employees are required to drive themselves or others, all driving time is compensable. However, when an employee is traveling to an overnight stay and has the option to use public transportation (i.e., airplane, train, bus, etc.) but chooses to drive his or her own vehicle instead, the employer can either choose to pay for all time spent traveling or pay only the travel time that occurs during normal work hours, regardless of what day of the week the employee travels (CFR 785.40). If an employee volunteers to drive others in his or her own vehicle to the overnight stay, an employee's time could be unpaid for those travel hours outside the normal work hours.

Worked performed while traveling. An employee must be paid for any time he or she is performing work. This includes time spent working during travel as a passenger that would otherwise be non-compensable.

For example, Meg normally works Monday through Friday, 8:30 a.m. to 5 p.m. She arrives at the airport on Sunday at 3 p.m. and at her destination at 8 p.m. Generally, the employer is required to pay her only from 3 p.m. to 5 p.m.; however, if Meg works on a presentation during her flight until 6:30 p.m., her employer would need to pay her from 3 p.m. to 6:30 p.m.

Some states have travel-time laws that are more generous than the federal FLSA.  

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What is Travel Time Pay and How Does it Work?

• Written by: Rinaily Bonifacio
• Last updated: 25 April 2024

This article will clear up any confusion about what constitutes travel time pay, who’s eligible, and the rules that need to be followed.

Table of contents

What is travel time pay?

Who is eligible for travel time pay, what is the criteria for compensable travel time, how to calculate travel time pay.

Travel time pay is the compensation employees receive for the time they spend traveling outside of their normal work hours as part of their job. This isn’t about the routine commute from home to work.

Instead, it’s about situations where an employee might need to travel to different job sites or attend meetings away from their usual workplace. It’s essential for employers to know when this time counts as payable work hours.

Travel time pay vs. Meal time pay

Travel time pay and meal time pay are distinct forms of employee compensation regulated under U.S. labor laws, specifically the Fair Labor Standards Act (FLSA). Here's a concise overview of each:

Travel time pay

Purpose : Compensates employees for work-related travel not part of their regular commute.

Compensability : Includes travel during regular working hours and overnight travel that intersects with normal work hours.

Exclusions : Does not cover the regular commute between home and work or personal travel outside work hours.

Meal time pay

Purpose : Addresses compensation during meal breaks within work hours.

Compensability : Generally unpaid unless the employee is required to perform duties during the meal period.

Exclusions : Meal breaks are non-compensable if the employee is completely relieved of duties for typically 30 minutes or more.

Legal basis for travel time compensation

In the United States, the Fair Labor Standards Act (FLSA) sets the ground rules for travel time pay. This law requires that non-exempt employees — those who qualify for overtime and minimum wage — must be paid for all hours worked.

According to the FLSA, time spent traveling during regular working hours as part of the employee's main job activities should be compensated. This doesn’t include commuting from home to work, but it does cover travel from one job site to another during the day or travel to a location for a special one-time task.

Eligibility for travel time pay under U.S. labor laws is mostly about whether an employee is exempt or non-exempt from the wage and hour laws stipulated by the FLSA.

Non-exempt employees are entitled to overtime pay and must be paid for travel time that occurs during their regular working hours. This includes hourly employees who often move between different job sites or are sent on special assignments outside of their regular working environment .

Exempt employees, those who typically receive a salary and are exempt from overtime pay due to their job nature, might not be eligible for additional pay for travel time, depending on the specifics of their roles and hours.

Travel time is compensable when it involves tasks that an employee must perform as part of their work, or during the employee’s regular work hours. This can include travel to and from different job sites within the same workday or unexpected travel required to complete work-related tasks.

The main criteria is that the travel directly pertains to and is necessary for the job, occurring during the employee's regular working hours.

Eligible travel scenarios for compensation

Understanding which travel scenarios are eligible for compensation under U.S. labor laws is crucial for employers to ensure they are compliant and fair. Here are eight detailed scenarios where travel time is typically compensable:

1. Travel between job sites:

When an employee travels between multiple job sites during their regular work hours, this travel time is compensable. For example, an electrician traveling between different homes or commercial buildings to perform installations or repairs during the day should be paid for this travel time.

2. One-time assignments in another city:

If an employee is sent to another city for a one-time assignment, the travel time spent getting to and from the destination is usually compensable. This includes the time spent driving or flying, minus the usual commute time.

3. Client visits during normal hours:

When employees need to travel to meet clients or attend meetings away from their primary workplace during their normal work hours, this time is compensable. For instance, a salesperson driving across town for client meetings during their scheduled workday should be paid for travel time.

4. Overnight travel:

Travel that requires an overnight stay away from the employee’s home community is generally compensable during the employee's normal working hours. This includes time spent traveling to and from the destination city. For example, if an employee usually works from 9 AM to 5 PM, travel time within those hours on an overnight trip should be paid.

5. Emergency calls out of regular hours:

If an employee must travel for emergency work outside of their regular hours, such as a technician called to fix a utility breakdown at night, the travel time is compensable.

6. Training events required by employer:

If attendance at a training event during regular hours requires travel, this time is typically compensable. For example, if an employer requires attendance at a training session that is not held at the usual place of work, the travel time to and from the training location during normal working hours is compensable.

7. Early morning or late night flights:

If travel involves early morning or late-night flights that fall outside of regular working hours but are necessary to reach a business-related destination, these may be compensable depending on the circumstances, like if travel during normal hours is not possible.

8. Travel to a different worksite for short duration:

If an employee is assigned temporarily to a worksite far from their regular location, the travel time more than their normal commute to the regular worksite is typically compensable. For example, if an employee who normally works in a downtown office is assigned for a week to a suburban office, the additional time spent traveling beyond their usual commute time should be paid.

Non-eligible travel scenarios for compensation

There are several travel scenarios where time spent is typically not compensable under U.S. labor laws. Understanding these can help employers avoid unnecessary payments and clarify company policies regarding travel. Here are five scenarios where travel time generally does not require compensation:

1. Regular commute from home to work:

The everyday travel time from an employee's home to their primary workplace is not compensable. This rule applies regardless of whether the employee works at a fixed location or at various locations. For example, a construction worker commuting to different job sites each day would not be paid for the time spent traveling from home to the first site or from the last site back home.

2. Travel from home to work on special one-time occasion:

If an employee is required to report to a job site that is not their regular workplace for a special one-time task and the travel distance is similar to their normal commute, this travel time is generally not compensable. For example, if an employee who normally works in an office downtown is asked to work one day from a client's office across town, the travel time does not need to be compensated if it is similar to their usual commute.

3. Travel as part of a residential move:

If an employee is relocating to another city for work and the company is paying for moving expenses, the time spent by the employee moving their residence is not compensable. This is viewed as personal travel, even though it's related to work.

4. Voluntary training not during regular hours:

When employees choose to attend training sessions or professional development workshops on their own time and such attendance is not required by the employer, the travel time to and from these events is typically not compensable. For instance, if an employee attends a weekend seminar related to their field but not specifically required by their employer, the travel time would not be paid.

Calculating travel time pay correctly is essential to ensure fair compensation for employees and compliance with labor laws. Here’s how you can accurately calculate the pay owed to employees for the time they spend traveling for work-related tasks.

Calculation of travel time pay

To calculate travel time pay, you should follow these steps:

Determine the employee's pay rate : This is the regular hourly wage the employee earns.

Identify compensable travel time : Record the amount of time the employee spends traveling during their normal work hours that does not include their regular commute from home to work.

Calculate total payable hours : Multiply the hours of compensable travel by the employee's hourly wage.

Formula : Travel Time Pay=(Number of Hours Spent on Compensable Travel)×(Hourly Wage)Travel Time Pay=(Number of Hours Spent on Compensable Travel)×(Hourly Wage)

For example, if an employee who makes $20 per hour spends 3 hours traveling to different job sites during their normal work hours, the calculation would be:

Travel Time Pay=3 hours×$20/hour=$60Travel Time Pay=3hours×$20/hour=$60

Discuss any mandatory minimums or rates stipulated by law

In the United States, several mandatory minimums and rates are defined under the Fair Labor Standards Act (FLSA) and must be adhered to when calculating travel time pay:

Minimum wage : The federal minimum wage is a baseline; however, some states have higher minimum wages. Employers must pay at least the federal minimum wage for all compensable travel time unless their state's minimum wage is higher.

Overtime : If travel time plus regular working hours exceed 40 hours in a week, employers must pay hourly employees overtime at one and a half times the regular rate for the hours over 40.

Special rates : Some contracts or state laws might specify higher rates for travel time, especially if traveling involves unusual hardship or is outside of normal working hours.

How to design a policy for travel time compensation?

Creating a clear and comprehensive travel time compensation policy is essential for any organization. This policy not only helps ensure compliance with labor laws but also sets clear expectations for employees regarding their compensation for travel .

Here are five detailed steps to guide you in designing an effective travel time compensation policy:

Step 1. Define compensable travel time:

Clearly outline what qualifies as compensable travel time within your organization. Specify the types of travel that are covered, such as travel between job sites, overnight travel required for work, and travel during an employee’s normal working hours.

Make sure to distinguish between travel that is part of the employee’s daily commute (which is generally not compensable) and travel that is an integral part of the employee’s duties.

Step 2. Establish travel time pay rates:

Determine the pay rates for travel time. Decide if the rate will be the same as the regular hourly rate or if there will be a different rate for travel time. Include details on how to handle overtime pay if the travel time contributes to an employee working more than their standard working hours.

Make sure these rates comply with the Fair Labor Standards Act (FLSA) and any relevant state laws.

Step 3. Outline procedures for recording travel time:

Develop and implement a system for employees to record their travel time. This could involve logging their hours in a timekeeping system or filling out a travel time sheet.

Provide clear instructions on how and when to submit these records, ensuring that employees know the importance of accurate and timely reporting to receive appropriate compensation.

Step 4. Communicate the policy to all employees:

Once the policy is developed, communicate it effectively to all employees. This can be done through staff meetings, email distributions, or by posting it on the company’s internal website.

Ensure that every employee understands the policy and knows who to contact if they have any questions or issues related to travel time pay.

Step 5. Review and update the policy regularly:

Laws and business needs change, so it’s important to review your travel time compensation policy regularly—at least annually. This will help ensure that your policy remains compliant with current laws and continues to meet the needs of your organization and its employees.

Be open to feedback from employees about how the policy is working in practice, which could provide valuable insights into any necessary adjustments.

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Travel time pay is a crucial aspect of employee compensation, particularly for non-exempt employees under the Fair Labor Standards Act (FLSA). Employers must carefully distinguish between compensable and non-compensable travel scenarios to comply with legal standards and maintain fair workplace practices.

By establishing a clear policy that outlines compensable travel, sets appropriate pay rates, and details procedures for recording travel time, organizations can ensure both compliance and clarity for all employees. Regular review and updates of this policy are essential to adapt to any changes in labor laws or organizational needs.

Written by:

Rinaily Bonifacio

Rinaily is a renowned expert in the field of human resources with years of industry experience. With a passion for writing high-quality HR content, Rinaily brings a unique perspective to the challenges and opportunities of the modern workplace. As an experienced HR professional and content writer, She has contributed to leading publications in the field of HR.

Please note that the information on our website is intended for general informational purposes and not as binding advice. The information on our website cannot be considered a substitute for legal and binding advice for any specific situation. While we strive to provide up-to-date and accurate information, we do not guarantee the accuracy, completeness and timeliness of the information on our website for any purpose. We are not liable for any damage or loss arising from the use of the information on our website.

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When Must I Pay Employees for Travel Time?

Travel Time vs. Commuting Time

Image by Jo Zixuan Zhou © The Balance 2020 

In general, your business should pay employees for the time they spend traveling for work-related activities. You don't have to pay employees for travel that is incidental to the employee's duties and time spent  commuting  (traveling between home and work). Travel time can include both local trips and travel away from home. 

Travel vs. Commuting Time 

Commuting is going back and forth to work. Everyone (at least everyone who doesn't work at home) commutes to a job. Commuting time is personal time, not business time. The IRS does not allow businesses to deduct commuting time as a business expense, and employees should not be paid for the commuting time.     

The Department of Labor (DOL) discusses employees who drive employer-provided vehicles. The DOL considers the time spent in home-to-work travel by an employee in an employer-provided vehicle, or in activities performed by an employee that are incidental to the use of the vehicle for commuting, generally is not "hours worked" and, therefore, does not have to be paid.  

Here's a possible rule of thumb: If your business authorizes a trip by an employee, no matter how the employee travels (car, train, bus, etc.) you should pay for the employee's travel time. 

Travel time for hourly and salaried employees may be counted differently. Pay to employees for local travel time is only applicable to non-exempt (hourly) employees, not to exempt (professional or managerial) employees.     Exempt employees are paid for their expertise by the job, not by the hour.  

Different Types of Travel Time:

Home to Work Travel , as explained above, is commuting time, not work time, and it's not paid.

Travel on Special One Day Assignment in Another City. The DOL says "the time spent in traveling to and return from the other city is work time," but they note that you may deduct the time the employee would spend commuting.

Sara works in an office in your company, but you send her to another city on a special assignment. She leaves from her home, goes to the city, and comes back home the same day. She spends 3 hours traveling (1 1/2 hours each way) from home to the other city. She would normally spend 30 minutes total driving from her home to work and back, so you could deduct the 30 minutes and pay her for 2 1/2 hours of travel time.

Travel That's Part of the Employee's Normal Work. Time an employee spends traveling is part of the job. You must count this time as work time. The time the employee spends going to the first job site, and home from the last job site, is commuting time and isn't paid.  

An LPN (licensed professional nurse) works for a nursing facility and travels between the two locations of this facility, providing care for patients at both locations. Her daily travel time between these locations must be included in her pay because she is not commuting. But she can't count the time driving from home to the first location or the time back home from the last location.

Travel Away from Home. If travel includes an overnight stay it is travel time. The DOL doesn't include travel away from home outside regular hours as a passenger on an airplane, train, boat, bus, or car as work time. But you must count hours worked on regular working days and work hours on nonworking days (weekends and holidays).  

If an employee travels from Cleveland to Pittsburgh for a two-day seminar at the direction of your company, you must pay for the hours the employee would have worked in a normal workday for each of those days, even if they were on Saturday or Sunday.

Incidental vs. Work Travel: Paid or Not Paid?

• An employee drives to work from his home every day. You ask him to stop on his way and pick up bagels for the staff meeting. This driving time is not paid. Time commuting to work is never paid time; the time to stop for the bagels is "incidental" to the commuting and is not part of the employee's job. 
• You ask an employee to drive to a store on work time to get bagels for the office meeting. If the employee makes this trip during normal work hours, he or she should be paid. 

Also, you might want to contact an employment attorney to discuss these issues. 

Paying for Travel Expenses

In addition to paying employees for travel time, you should pay their expenses for travel. The Department of Labor doesn't require reimbursement for travel expenses, but it makes sense to pay employees if you require them to travel.   Your business can deduct employee travel expenses as a business expense.   If employees mix business and personal travel, you need to sort out the part that is business-related and pay only these expenses. 

State Regulations on Paying for Employee Travel

Check with your state labor department to see if there are any rules which might override the federal rules. Contact the nearest local office of the U.S. Department of Labor for information on specific instances of travel time that affect your business.

Internal Revenue Service. " Publication 535 (2019): Business Expenses ," Page 5. Accessed May 26, 2020.

Internal Revenue Service. " Travel & Entertainment Expenses ," Page 3. Accessed May 26, 2020.

U.S. Department of Labor. " Travel Time ." Accessed May 26, 2020.

Electronic Code of Federal Regulations. " Travel Time ." Accessed May 26, 2020.

U.S. Office of Personnel Management. " Fact Sheet: Hours of Work for Travel ." Accessed May 26, 2020.

U.S. Department of Labor. " Fact Sheet #17D: Exemption for Professional Employees Under the Fair Labor Standards Act (FLSA) ," Pages 1-3. Accessed May 26, 2020.

U.S. Department of Labor. " Fact Sheet #22: Hours Worked Under the Fair Labor Standards Act (FLSA) ." Accessed May 26, 2020.

U.S. Department of Labor. " Opinion Letter FLSA 2018 ," Page 2. Accessed May 26, 2020.

U.S. Department of Labor. " Reimbursed Travel Expense Payments ," Page 1. Accessed May 26, 2020.

Internal Revenue Service. " Topic No. 511 Business Travel Expenses ." Accessed May 26, 2020.

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Travel time as hours of work, applicability.

This information applies to GS, FP, and FWS EXEMPT and NONEXEMPT employees.

When is Travel Compensable

Time in a travel status away from the official duty station is compensable for EXEMPT and NONEXEMPT employees when the travel is performed within the regularly scheduled administrative workweek, including regularly scheduled overtime. In addition, travel is compensable for both categories of employees for purposes of meeting the daily and weekly overtime standards when it:

• Involves the performance of work while traveling, (e.g., as a chauffeur or courier);
• Is incident to work performed while traveling (e.g., a courier's travel relative to the spot where further travel to deliver a diplomatic pouch would begin);
• Is carried out under such arduous and unusual conditions that the travel is inseparable from work; or
• Results from an event which could not be scheduled or controlled administratively, including travel by an employee to such an event and the employee's return from such an event to his or her official duty station.

For a NONEXEMPT employee, travel meeting the weekly overtime standard (but not the daily overtime standard) also includes:

• Travel as a passenger on an overnight assignment during hours on nonworkdays which correspond to regular working hours; and
• One-day travel as a passenger to and from a temporary duty station (not including travel between home and the employee's normal duty station).

Who Makes the Determination

Officials to whom authority has been delegated to authorize or approve travel on official business are responsible for determining whether travel outside the regularly scheduled workweek meets any of the conditions for hours of work.

How Much Travel Time is Creditable For Pay

When travel outside the normal workweek constitutes hours of work, the following rules will apply in determining the amount of time in a travel status that is deemed hours of work for premium pay:

When is an employee in travel status . An employee is in a travel status only for those hours actually traveling between the official duty station and the point of destination, or between two temporary duty points, and the usual waiting time which interrupts travel.

When traveling by common carrier . Time in a travel status begins with the scheduled time of departure from the common carrier terminal, and ends upon arrival at the common carrier terminal located at the destination. However, when the employee spends 1 hour or more in travel between the common carrier terminal and place of business or residence, then the entire time traveling between the carrier terminal and place of business or residence (that is actual time traveling, exclusive of waiting time at the terminal prior to the scheduled departure time) counts as hours of work.

Waiting time . Usual waiting time between segments of a trip or at common carrier terminals counts as worktime for premium pay (up to 3 hours in unusually adverse circumstances, e.g., holiday air traffic, severe weather) provided travel away from the duty station is compensable because it meets any of the conditions of this Section.

Authority to Order Noncompensable Travel

Congress has not provided a remedy whereby an EXEMPT employee who performs official but noncompensable hours of travel may be compensated (57 Comp. Gen. 43, 50, 1977). A manager does, however, have the authority to schedule official travel that is noncompensable. As a requirement of 5 CFR 610.123, the manager must record the reasons for ordering such travel in a memo to be filed with the employee's Time and Attendance Report (T&A). A copy of the memo must be given the employee if the employee requests it.

Work performed while traveling . In order to meet the intent of the law as defined in the majority of Comptroller General decisions, work performed while traveling must be work which is inherent in the employee's job and which can only be performed while traveling, e.g., chauffeuring, hurricane reconnaissance performed aboard a plane flying into the eye of the hurricane, etc. Discretionary work such as review of a scientific presentation by a scientist or treaty papers by a foreign service officer enroute to a meeting is work which could be performed in an office independently of travel and does not satisfy the definition of work while traveling and is, therefore, not compensable for purposes of overtime. (B-146288, January 3, 1975)

Work incident to work performed while traveling . Travel which is incident to work performed while traveling must also meet the definition of "work performed while traveling" above. Travel which is necessary to meet another mode of travel is compensable for overtime purposes if the traveler performs work while traveling which is an inherent part of the job and which could only be performed while traveling, for example, a motor vehicle operator who is ordered to travel by plane in order to take responsibility for a truck which he or she is then to deliver to its permanent location (57 Comp. Gen. 43 (1977), or a courier who travels to pick up and deliver a pouch (B-178458, dated June 22, 1973). Travel and incidental transport of files is not within the definition since the transportation of files is work not inherent in the job (B-181632, dated April 1, 1975).

Travel under arduous conditions . Arduous means more than the inconvenience associated with long travel delays, unbroken travel, unpleasant weather, or bad roads. Prolonged travel in heavy blowing snow which makes driving difficult but stops short of endangering the employee might be considered arduous. A distinction must be made between travel which is arduous and travel which is hazardous duty. Each case must be judged on its own merits (B-193623,

July 23, 1979).

Travel resulting from an event which could not be administratively scheduled or controlled . An event that cannot be administratively scheduled or controlled implies immediate official necessity for travel. If it is discretionary when the employee begins travel, not including the minimum necessary time to make travel arrangements, the notion of immediate necessity which is implied by an event that could not be scheduled or controlled is lacking and the intent of the law as defined by the General Accounting Office is not satisfied. Therefore, time spent in such travel would not be compensable for overtime purposes

(B-186005, August 31, 1976).

Within the agency's administrative control . Whether the scheduling or timing of the event that precipitates an employee's travel was within the administrative control of the agency is strictly interpreted in decisions of the Comptroller General (CG). Travel on overtime to and from a meeting arranged at the discretion of two Federal agencies is not compensable since agencies have it within their power to ensure that the employee travels during work time (B-146288, January 3, 1975 et alia).

For the same reason, travel to and from training which is conducted by the government, under government contract or by a private institution solely for the benefit* of the government is not compensable since the government has it within its power to ensure that the start and end times of such training allow the employee to travel on work time (B-190494, May 8, 1978; also, 66 CG 620, 1987).

*In William A. Lewis et al, 69 CG 545 (1990). The CG ruled travel on overtime to and from training that is given by a private institution is compensable because government cannot control the private institution or its scheduling of the course. The Lewis opinion further held that the notion of "immediate official necessity for travel" which prior CG decisions have held must be present in travel which responds to an event that is not schedulable or controllable was established by the start time of the class. To be present when the class began, the employees had to travel on Sunday.

NOTE : The regulations which govern training time which is compensable as overtime and travel to and from training are separate and distinct. The circumstances under which premium pay may be paid while an individual is in training are covered in the section titled Premium Pay and Training.

Meeting abroad - a matter of accommodation . An employee's claim for overtime compensation for travel overseas to be present at the opening of a conference with representatives of a foreign government was disallowed. Although the employee's agency indirectly scheduled the meeting through the USAID Mission, the Comptroller General ruled the lack of governmental control envisioned by law and regulation for travel on overtime to be deemed compensable was not present. (Gerald C. Holst, B-202694, January 4, 1982; and B-222700, dated October 17, 1986).

NOTE : The Lewis decision (see discussion above) precipitated a review of CG decisions with the result that government control of events was sufficient to validate all previous decisions except one: Gerald C. Holst, was overruled. In overruling the 1986 decision, the Comptroller General found the agency to lack control of the scheduling of the meeting to an appreciable degree. Further, the start time of the opening conference established the immediate official necessity for travel. Travel, was, therefore, compensable.

Failure to plan . An employee who travels outside his or her normal tour of duty to perform maintenance on equipment so that the equipment can perform necessary functions in accordance with operational deadlines is not performing compensable travel if the maintenance responds to gradual deterioration which could have been prevented if maintenance was scheduled on a timely basis (49 Comp. Gen. 209, 1969).

Two-day per diem rule . An employee may be required to travel on his or her own time if in order to allow the employee to travel during working hours, the agency would be required to pay two days or more per diem. However, the two-day per diem rule does not of itself support an entitlement to overtime compensation for the employee. To be compensable at the overtime rate, travel must respond to an event that could not be scheduled or controlled administratively and there must be an immediate official necessity for the travel to be performed outside the employee's regular duty hours (60 Comp. Gen. 681, 1981).

Return travel . When an employee performs compensable overtime by traveling to an event which could not be controlled or scheduled, he or she is automatically eligible for compensation for return travel to his or her duty station.

Disparity in hours of work means disparate overtime entitlement . Because FLSA provides two situations in which a NONEXEMPT employee, but not an EXEMPT employee, can be paid for travel on overtime hours, (specifically, during hours on nonworkdays which correspond to regular working hours and for one-day travel as a passenger to and from a temporary duty station), it is possible for a NONEXEMPT employee to be paid for travel when an EXEMPT employee in the same situation is ineligible for overtime pay.

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Workers Comp

Responsibility for employees injured while traveling for work can be murky

Stephanie Goldberg

Recent workers compensation cases involving traveling employees highlight the need for employers to implement clear and specific travel policies.

Travel cases are known to “turn on little nuances and facts,” said Robert Turner, senior attorney and shareholder at The Silvera Firm in Dallas. But a travel policy that clearly defines what activities are considered work-related and what aren't can help employers minimize potential exposures, he added.

In one, Barbara Pinkus v. Hartford Casualty Insurance Co. , a Texas appellate court ruled in November that JVL Ventures L.L.C. employee Ron Pinkus, who died from injuries he sustained in a car accident while out of town on business, was not within the course and scope of his employment because he was driving to meet his son for dinner at the time.

Though Mr. Pinkus' transportation, lodging and reasonable meal expenses were covered by JVL Ventures, according to its travel expense policy, his “activity at the time of his injury did not originate in and was not in furtherance of his employer's business affairs,” court records show.

More often than not, claims by traveling workers that have to do with eating are covered under workers comp, but such cases “require a much different level of critical analysis than if someone slipped and fell walking down the hall in their office,” said Edward Canavan, Riverside, California-based vice president of workers compensation practice and compliance at Sedgwick Claims Management Services Inc.

Several recent cases that address traveling workers have focused on what a worker was doing when he or she was injured, Mr. Turner said.

Mr. Turner said most of his cases are won because an injury “relate(s) to or originate(s) in the employer's business and occur(s) in the furtherance of the affairs of the employer,” not because of exclusions such as “dual-purpose travel.”

Though Mrs. Pinkus argued that her husband was engaged in dual-purpose travel at the time of his accident, as the overall purpose of his trip was in the furtherance of his employer's affairs, he wasn't considered to be in the course and scope of his employment, so there was no need to discuss the exclusion, records show.

Sources said it's unlikely that the decision would be overturned on appeal.

Employees whose jobs extend beyond a single workplace, such as truckers and sales representatives, are more likely to get injured while traveling, sources added.

Such cases are common in Texas, with people in the oil industry working at remote locations, Mr. Turner said, adding that his office usually handles six to 12 traveling worker cases at any time.

On the other hand, Albert B. Randall Jr., Baltimore-based principal at law firm Franklin & Prokopik P.C., said his practice doesn't see many cases involving traveling workers, but those he does see “create a fair amount of appeals because there are some interesting issues at stake.”

Travel policies become especially important in cases involving employer-provided transportation, which is a common exception to the “going and coming” rule that states employees injured while commuting to or from work generally aren't entitled to workers comp, sources said.

Since employees are often seen as doing employers a favor by traveling for work, “it's difficult for the employer to impose too many restrictions on what the employee (can do) off the clock,” Mr. Randall said. What employers sometimes do “is simply have general parameters on what's expected of the employee,” which practically leaves “it up to the court system

as to determining what is compensable.”

Traveling employees provide a unique challenge for risk managers since they have little control over the work environment, Mr. Canavan said. For example, if a flight attendant on a layover checks into a hotel, the risk manager doesn't know whether there are special hazards in the room, he said.

What risk managers can do is make sure workers are aware of the typical kinds of injuries, such as fatigued driving among truckers, Mr. Canavan said. It's also possible to minimize exposures by clearly defining job duties, so workers know personal errands might not be in the course and scope of their employment, he added.

Employers should also find out what activities are likely to be considered within the course and scope of employment, sources said. A lot of times it's about whether an “activity was a significant enough deviation from the overall purpose of the trip to make it noncompensable,” Mr. Randall said.

In addition to clearly stating in a travel policy that all company policies apply whether in the office or on the road, many employers include a rule about not using mobile devices while driving, said Edwin Zalewski, human resources professional at J. J. Keller & Associates Inc. in Neenah, Wisconsin.

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Does Workers Comp Coverage Follow Traveling Employees?   //

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Does workers comp coverage follow traveling employees.

Traveling employees can create workers compensation coverage nightmares—and many agents are unaware of these traveling landmines until after the injury.

The problems arise at the junction of two key concepts:

Extraterritoriality. How does the sending state’s workers comp policy respond when one or several workers leave the state to perform operations for or conduct duties on behalf of the employer? More simplistically, does the workers comp coverage follow the employee when they leave the state to work? And are there any limitations on the extraterritorial benefits?

Answering the first question is easy. Every state provides extraterritorial work comp benefits to employees who travel to another state for business purposes. However, some states limit the applicability of these traveling benefits in one of two ways:

• Extraterritorial benefits end after a specified number of days. Some states limit the number of days coverage follows the worker to another state.
• The worker must qualify for in-state benefits based on a multipart test. Many test-based states apply Larson’s four-part test to determine whether an employee working in another state qualifies for in-state protection and benefits. Larson’s four-part test extends in-state benefits to traveling employees if they meet one of the following four qualifications:
• Their employment is principally localized in the sending state.
• They are working under a contract of hire made in the sending state for employment not principally localized in any state.
• They are working under a contract of hire made in the sending state for employment principally localized in another state whose workers comp law is not applicable to the employer, such as a state that has a number threshold.
• They are working under a contract of hire made in the sending state for employment outside the U.S.

Test-based states that do not directly apply the Larson test generally use a similar variation. If the worker does not qualify under the state’s test, benefits do not follow the worker and there is no extraterritoriality.

Reciprocity. How does the receiving state—the state to which the worker travels to work—view the workers comp coverage from the sending state? This question involves two issues: Does the receiving state’s workers comp law have jurisdiction over the out-of-state workers traveling into the state? And does the workers comp policy from the sending state satisfy the receiving state’s workers comp statutes?

Reciprocity is more frustrating than extraterritoriality. While every state provides extraterritorial benefits to qualified employees for some period of time, extraterritorial laws don’t consider the receiving state. In practicality, extraterritorial benefits apply only when the receiving state recognizes the coverage. So the important question becomes, what are the receiving state’s reciprocity rules?

Some states simply don’t care about another state’s extraterritorial coverage. Employees working in non-reciprocating circumstances or non-reciprocal states must abide by and are subject to the workers comp law of the receiving state. These statutes vary widely and fall into one of three levels of reciprocity:

• No reciprocity: These states are not concerned with the laws of any other state. Employees who work in these states must abide by their workers comp laws.
• Full reciprocity: These states generally maintain a list of states with which they have a reciprocity agreement, fully recognizing the other jurisdiction’s laws without limitation.
• Limited reciprocity: These states reciprocate, but not in full. Four common reasons for non-reciprocity are:
• Business class: Construction is the most common business class excluded from reciprocity. States that otherwise reciprocate may refuse to recognize the sending state’s workers comp coverage when the insured is in a construction class.
• Employee count: Some states reciprocate when the out-of-state employer sends only a limited number of workers into the state. These are generally states that have a number threshold greater than one for even an in-state employer to have workers comp. Once the number of out-of-state workers eclipses a certain number, these states no longer reciprocate.
• Time in state: A few states recognize the sending state’s coverage for a limited amount of time. Once the time limit is eclipsed, reciprocity ends.
• Lack of mutual reciprocity: Quid pro quo—mutual reciprocity states recognize the sending state’s benefits only if the sending state recognizes the receiving state’s benefits when the roles are reversed.

Out of Sync?

Knowing the states to which employees might travel for work is essential when developing an insured’s workers comp plan. If you miss or ignore the extraterritorial and reciprocal exposures, you risk complete loss of protection. If the sending state’s workers comp does not respond, the insured is responsible for paying out of its own pocket all benefits required by law for a work-related injury.

No self-funding threat exists when the sending and receiving states’ extraterritorial and reciprocity provisions align. The sending state’s workers comp follows the worker, and the receiving state recognizes the coverage. Benefits are paid under the sending state’s laws and the receiving state asserts no authority over the situation.

But when extraterritorial and reciprocal laws do not dovetail, coverage for travelling employees requires specific action on your part. Depending on the situation, workers comp protection can be extended in one of two ways.

When the sending state’s benefits do not apply in the receiving state, list the receiving state as an additional “Primary” state, also known as a 3.A. state. Use this approach anytime there are known or suspected extraterritoriality or reciprocity issues. States that may require 3.A. status include:

• The employer’s home office and branch office states.
• The employer’s state of incorporation, if other than a home or branch office state.
• Any state where the employer hires temporary employees solely to perform operations in that state of hire.
• Any state where a subcontractor is hired to perform work on behalf of a general contractor if proof of workers comp is not provided.
• Any state that has significant contact with an employee.
• The state in which the contract of hire was executed, even if the employee moves.
• Any state that does not reciprocate with any listed state.
• States with limited reciprocity provisions.
• Monopolistic states, which require a separate policy.

These are merely recommendations and not rules. Keep in mind, underwriters may be unwilling to extend 3.A. status, even when you make a good case.

Uh-Oh Protection

You may also extend “Other State,” also known as secondary or 3.C., status to the receiving state, but this is intended only as a safety net. Use this approach only in situations where there is no indication that the receiving state can or will assert authority over the worker, or when an insured begins new temporary operations during the policy period.

Part Three – Other States Insurance dictates how the workers comp policy responds if an employee is injured in a non-3.A. state, but—due to unexpected extraterritorial or reciprocity problems—receives the option to choose the benefits mandated by the state of injury rather than a listed 3.A. state.

Benefits extended to workers in 3.C. states comply with the statutory benefits required by the state where the employee is injured. The workers comp policy responds and pays benefits in listed 3.C. states, just as if the state was scheduled under 3.A.

3.C. protection should be structured to include any state to which the underwriter is willing to extend coverage. Most errors & omissions carriers recommend garnering 3.C. status with the phrase, “All states, territories and possessions other than 3.A. states and monopolistic states.” However, some carriers refuse to allow this breadth of protection due either to license status or a desire for greater information regarding the location and activities of the employees.

If the underwriter is unwilling to apply the overt “All states…” wording, build the “other states” coverage as broad as possible by taking the following steps:

• Specifically schedule those states that qualify for 3.A. as per the previous recommendations but which the underwriter would not allow.
• If not included in 3.A., specifically list all bordering states.
• List all states to which employees regularly travel for training or meetings.
• Complete the schedule by adding the terminology, “All remaining states, territories and possession other than 3.A. states, listed states and monopolistic states.”

Note that an underwriter might argue, “We can’t list State as a 3.C. state because we are not licensed there.” This is a bogus claim. Paragraph A.3. under Part Three – Other States Insurance reads: “We will reimburse you for the benefits required by the workers’ compensation law of that state if we are not permitted to pay the benefits directly to persons entitled to them.”

Other than not being licensed in the state, why would the carrier not be allowed to pay the injured worker directly? Just because they don’t want to list a state doesn’t mean they can’t.

Chris Boggs  is executive director of the Big “I” Virtual University  and an IA contributor.

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Work Comp: When Are Commuting Employees Covered?

by Jodi Mathy

For the most part, employees on their way to and leaving from work  are not  eligible for  workers' compensation. This is referred to as the "coming-and-going rule." In other words, accidents during these times are an employee's business, and her employer is not on the hook. It also should be noted that employees who are running errands during a work day that are substantially unrelated to their employment also are not covered by workers' compensation.

5 Times When Workers' Compensation May Be in Play

Let's talk, however, about when a commuting employee  might  be covered. Here are five situations that  could  be covered by work comp:

1.) Salespeople, nurses, and other employees who are on the road a lot often are exempt from the coming-and-going rule. Travel is integral to their employment because they don't work from a fixed office.

2.) On-call employees likely are covered  from the moment they are called into work  even if they get hurt at home.

3.) Employees who are injured during business travel may receive compensation, even if the accident happens during recreation. Courts generally are liberal in determining work comp eligibility in work travel accidents, even if the injurious activity would not be considered work related at home.

4.) If an employee has to drive through a "zone of danger" — construction sites, blasting zones — to get to work, he may be eligible if injured.

5.) If an employee runs a work-related errand on the way home from work and gets in an accident, her injuries may be compensable. Another example of this would be if an employee is injured running a work-related errand while out for [personal time] lunch. This relates to the dual purpose or capacity concept.

It's worth noting that workers' compensation coverage for commuting employees varies state to state. Because of this, it's best practice for insured companies to report possible workers' compensation claims ASAP. Quick and accurate reporting allows insurance carriers to investigate and determine compensability.

Assessing the Situation

Asking the following questions will assess whether the coming-and-going rule applies to a potential claim:

• Did the injury happen during a normal commute or during a personal errand away from work during the work day?
• Was the trip for personal reasons? If not, did it include personal  and  business tasks? If so, would the trip have been made if the personal reasons were eliminated?
• Did the employee deviate from a personal trip to run an errand for the employer? If so, did the employer request the errand?
• Is travel part of the employee's job duties?
• Is the employee required to drive her own car to work for job responsibilities, or is it a company car, or is the employee reimbursed for mileage?
• Did the employer pay entirely for the travel?
• Is reimbursement for commuting costs/time part of the employee's work contract?
•  Was the travel between multiple work sites or buildings that are controlled by the employer?
• If the injury occurred off employer property, was it during entrance or exit from the place of employment?
• Were any aspects of the trip unusually hazardous?
• What benefit did the employer gain from the employee's trip? Was the trip mutually beneficial for employer and employee?
• Was the employee on call?
• Was the employee attending an event at the request of the employer (e.g., conference, training)?
• Was the employee transferring work-related materials that presented a special risk?
• Did misconduct or illegal conduct contribute to the accident?

The answers to these questions are a starting point to help determine whether a potential claim would fall under work comp. If you do have a potential claim, consult your risk advisor or HNI Relationship Manager to explore these criteria further.

How do you manage risk brought on by commuting employees? Please share below in comments!

Related Posts:

Reporting Workers Compensation Claims: 5 Reasons to File 'Em Fast!

Workers Compensation Trends: Where We’ve Been and Where We’re Headed

Michigan Workers Compensation Law: ‘Degenerative’ vs. ‘Disability’

How Workers' Compensation Subrogation Works

Photo by Cory M. Grenier via Flickr

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Treasury, IRS issue frequently asked questions related to the tax treatment of work-life referral services provided to employees

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IR-2024-110, April 16, 2024

WASHINGTON — The Internal Revenue Service today issued frequently asked questions (FAQs) in Fact Sheet 2024-13 related to the tax treatment of work-life referral services provided to employees under an employer’s work-life referral program.

A work-life referral program is an employer-funded fringe benefit that provides work-life referral services to eligible employees.

Work-life referral services are restricted to informational and referral consultations that assist employees with identifying, contacting and negotiating with life-management resources for solutions to a personal, work or family challenge. For example, choosing a suitable child or dependent care program, connecting with a local retirement or financial planner or navigating eligibility for government benefits.

The FAQs released today clarify that, under certain circumstances, the value of work-life referral services provided to employees through a work-life referral program can be excluded from income and employment taxes as de minimis fringe benefits.

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