Legal Ease

A common concern for roofing contractors is when and how to compensate employees for travel time. Many roofing contractors are unaware of the circumstances that require them to pay employees for time spent traveling to and from work. If you mistakenly assume the time an employee spends traveling to and from work is not compensable, you may be surprised if you are audited by the U.S. Department of Labor (DOL) and consequently required to pay large sums of money for back wages and applicable interest. Therefore, it is important you understand when employees are entitled to compensation for time spent traveling to and from work.

Portal-to-Portal Act

The legal basis for an employee’s entitlement to travel-time compensation is found in the Fair Labor Standards Act’s (FLSA’s) amendments, which commonly are referred to as the Portal-to-Portal Act. These amendments make commuting time to and from work noncompensable but include certain exceptions.

The Portal-to-Portal Act states no employer should be liable to his employees for failing to pay minimum wages or overtime compensation for time spent traveling to and from an actual place of performance of the principal activities a company’s employees are employed to perform. This includes time before a particular workday commences and after a workday ceases. In other words, travel time at the beginning and end of a workday need not be counted as work time unless an exception applies.

The exceptions to this rule depend largely on the type of travel involved. Also, you will be liable for failing to compensate employees for travel time if travel is compensable by express contract or custom or practice not inconsistent with an express contract.

Travel categories

FLSA defines four basic categories of employee travel—all are common to roofing workers. The categories include portal-to-portal travel, travel between work sites, special one-day assignments and overnight travel.

Portal-to-portal travel

Portal-to-portal travel consists of an employee’s typical travel at the beginning and end of each workday. The Portal-to-Portal Act states typical travel is not required to be compensated by employers because it is considered a typical employment incident, not work time. This rule applies regardless of whether a roofing worker works at a fixed location or different work sites.

You are not required to pay employees for portal-to-portal travel unless you have created a policy or contract promising to pay employees for such travel. An exception to this rule applies when an employee’s travel time includes the performance of duties on behalf of a contract and/or for the company’s benefit.

For example, if you require an employee to stop at one work site at the beginning of a workday to receive instructions, attend a meeting, or pick up tools or a company vehicle before reporting to another work site, travel from the employee’s home to the first location need not be compensated. But once the employee arrives at the first location, the employee is considered to be on the clock and subsequent travel time is compensable.

Roofing contractors often get confused about whether travel time is compensable when a roofing worker drives a company vehicle home. Such travel time remains noncompensable as long as the employee performs no work duties until reaching a work site. The key to determining whether travel time is compensable is whether the employee performs work before reaching a work site, not whether the employee drives a company-owned vehicle to and from work.

Travel between sites

When a roofing worker is required to travel from one work site to another work site during a day’s work, travel time is compensable. For example, if a roofing worker earning an hourly wage completes a roofing project at one work site, you are required to compensate him for the time spent traveling to the next work site provided the travel occurs during typical work hours.

Similarly, if a typical workday ends at 4 p.m. and an employee, who is required to return to his fixed work location before going home, arrives at his fixed work location at 5 p.m., the hour from 4 p.m. to 5 p.m. is compensable work time.

Often, there are instances when a roofing worker arrives home after a day’s work and is called back to work and asked to travel a substantial distance to perform an emergency leak repair. This travel time would be considered work time and is compensable.

Interestingly, DOL has not taken a position about what constitutes a substantial distance or whether emergency travel to a roofing company’s office outside of regular work hours to pick up tools for an emergency leak repair or attend an emergency meeting is considered work time. However, it is a good idea to compensate employees for such travel because the time was not anticipated by the employee, and an employer should not be able to request an employee return to work outside of typical work hours to perform tasks without compensation.

One-day assignments

Another travel category is the special one-day assignment, which applies when an employer requires an employee who typically works at one fixed location to report for a day at an alternate work site in a city more than 30 miles (48 km) from his primary work location. This travel time is compensable.

Consider the following scenario: A roofing contractor employs 12 roofing workers at his Washington, D.C., location. Regular business hours are 7 a.m. to 4 p.m. The contractor gives five roofing workers a special one-day assignment in New York City with instructions to leave Washington at 6 a.m. The roofing workers drive themselves in a company vehicle and arrive in New York City at 10 a.m. The special assignment is completed at 1 p.m. The crew returns to Washington at 5 p.m. This type of travel was performed for the employer’s benefit and at the employer’s special request to meet the needs of a particular and unusual one-day assignment. Therefore, the travel time is compensable.

The situation would change, however, if the roofing crew took a train to New York City. If it had not been for the special assignment, the employees would have had to report to their regular work site. Therefore, the travel time between the crew members’ homes and train station would not be compensable because it would be considered home-to-work travel. However, if the employer ordered one of the workers to pick up the employees and drive them to the train station, travel time pay is owed the driver. If the driver chose to pick up the employees on his own, the travel time is not compensable. Travel time on the train to New York City is compensable for the workers but the typical meal time would not be compensable if it is not compensable during a regular workday.

The result also would change if an employee frequently works at different locations and doesn’t have a fixed work location. Assume an employee is a safety manager being paid an hourly wage. The safety manager’s typical duties require him to travel to all the roofing company’s work sites without using the Washington office as a fixed work location. In this situation, the safety manager’s travel time is noncompensable. His travel time falls under the portal-to-portal category even when he travels to remote locations for the day. The special one-day assignment rule only applies when an employee has a fixed, official work location.

Overnight travel

The overnight travel category applies when travel keeps an employee away from his home overnight. During overnight trips, the time an employee spends traveling as a passenger during typical work hours must be compensated, including weekends, because the employee is substituting travel for other duties. You are not legally obligated to compensate employees for travel time outside regular work hours except when the employee is required to drive.

For example, let’s say a southeastern Michigan roofing contractor with a contracting company that has typical work hours of 7 a.m. to 4 p.m., Monday through Friday, instructs an employee to attend a two-day safety training conference in Chicago. The employee travels by bus on Wednesday from 10 a.m. to 3 p.m. The roofing contractor must pay for the five hours of travel because they occur during the employee’s typical work hours. The employee returns home by bus on Saturday traveling from 2 p.m. to 7 p.m. The roofing contractor must pay for the two hours between 2 p.m. and 4 p.m. because they occur during the employee’s typical work hours. This is required though the employee does not typically work on Saturdays. The time spent traveling between 4 p.m. and 7 p.m. is noncompensable.

The situation would change if the employee chose to drive his car rather than take public transportation. In this scenario, the roofing contractor is not required to count the entire time the employee spends driving as hours worked. The employer is required to compensate the employee for driving time incurred during typical work hours.

What would happen if the employee arrived at a Chicago bus station and still had to drive an additional two hours to the location of the safety training conference? In this case, because the employee is required to drive during time outside typical work hours, the travel time is compensable.

Miscellaneous issues

Roofing contractors often inquire whether travel time is compensable if a company’s policy is to pay per diem and/or mileage to employees. An employer is obligated to pay for travel when required regardless of whether he also offers his employees per diem and/or mileage pay.

Another issue roofing contractors frequently confront is whether travel time is compensable when a contractor arranges for a company vehicle to pick up his employees and deliver them to a work site. If the transportation is provided primarily for the benefit of employees and employees are not required to travel in the company vehicle, the time is not compensable. However, the driver’s time is compensable because he is performing work. Also, if the employer requires his employees to travel in the company vehicle, the travel time is compensable.

Another issue is whether a contractor can pay his employees a different travel-time rate than regular work rates. An employer can pay a different rate provided he pays at least minimum wage for travel time. If this is the practice adopted by a company, it should be adequately communicated to employees.

Lastly, compensable travel hours are required to be counted toward overtime calculation.

With a basic understanding of the Portal-to-Portal Act and its application, you can avoid the surprises often associated with an audit conducted by DOL.

Philip J. Siegel is an attorney with the law firm Hendrick, Phillips, Salzman & Flatt, Atlanta.