When is training time for nonexempt employees compensable?
Wednesday, April 05, 2017
Employers train employees in countless ways to perform better and for various legal compliance reasons. Such training can be in a one-time session in-house, a series of commercial courses or more formal classes at the local college.
Before you schedule your next training session, you should consider that the Fair Labor Standards Act (FLSA) may require you to pay nonexempt employees for time (including possibly overtime) spent in the training session.
The compensability of time spent by nonexempt employees in training is determined under general principles set forth in the U.S. Department of Labor (DOL) regulations implementing the FLSA. Attendance at lectures, meetings, training programs and similar activities should generally be counted as working time, thus nonexempt employees need to be compensated — unless all of the following four criteria are met:
1. Attendance is outside of regular working hours
In some situations time spent in attending lectures, training sessions and course of instruction is not regarded as hours worked. For example, an employer may establish for the benefit of his employees a program of instruction that corresponds to courses offered by independent bona fide institutions of learning.
Voluntary attendance by an employee at such courses outside of working hours would not be hours worked even if they are directly related to his job or paid for by the employer.
Of course, if an employee on his own initiative attends an independent school, college or independent trade school after hours, the time is not hours worked for his employer even if the courses are related to his job — and even if the employer offers a tuition reimbursement benefit.
2. Attendance is voluntary
Attendance is not voluntary if it is required by the employer. It is also not voluntary if the employee is given to understand or led to believe that his pay, present working conditions or the continuance of his employment would be adversely affected by nonattendance.
Participation in courses that are a prerequisite for a promotion will be considered voluntary where the existing classification level or working conditions are not adversely affected by an employee's decision not to participate.
3. Training is not directly related to employee's job
Training is directly related to an employee's job if it is designed to make the employee handle the job more effectively, as distinguished from training him for another job or for a new or additional skill.
For example, a stenographer who is given a course in stenography is engaged in an activity to make her a better stenographer. Time spent in such a course given by the employer or under his auspices is hours worked.
However, if the stenographer takes a course in bookkeeping, it may not be directly related to her job. Thus, the time she spends voluntarily in taking such a bookkeeping course, outside of regular working hours, need not be counted as working time.
Where a training course is instituted for the bona fide purpose of preparing for advancement through upgrading the employee to a higher skill, and is not intended to make the employee more efficient in his present job, the training is not considered directly related to the employer's job, even though the course incidentally improves his skill in doing his regular work.
4. No productive work is performed
While in some sense it is "productive work" to acquire a new skill or improve oneself through the kinds of training programs and lectures this article addresses, courts interpreting the DOL regulations have taken a more pragmatic approach.
In one case, a group of police officers brought suit to recover overtime pay for off-duty hours spent performing physical fitness training. The 11th Circuit Court of Appeals reversed the lower court and held that working out at the local gym — even though the county required the officers to pass a semiannual fitness test and to generally "stay in shape" — was not compensable time under the FLSA.
In addressing the requirement that no productive work be performed, the court noted the officers were "employed to respond to potentially life-threatening situations, and no such work was undertaken while they were exercising."
Employee training is an integral part of most jobs today. Employers should not shy away from providing meaningful training experiences for fear of reprisal from the DOL if they do not treat the time as compensable. Just be sure the training clearly meets all four requirements if nonexempt employees will not be paid for the time they spent in such training.
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