Recent DOL Guidance Clarifies When Travel Time is Compensable

It is an issue that has long plagued employers: whether to pay employees for time spent behind the wheel of a motor vehicle when driving is not a primary duty of the job? It is a seemingly straight forward issue that, like many areas of the law, depends on various facts and circumstances. The Department of Labor (“DOL”) has recently issued guidance that clarifies some of those circumstances related to a construction company with foremen and laborers who travel to a yard before to retrieve a company vehicle before departing for customer sites — a close analogue to the travel practices that many oil field services companies employ. See U.S. Dep’t of Labor, Wage & Hour Div. Opinion Letter FLSA2020-16.

Generally, under the Fair Labor Standards Act (“FLSA”), an employee must be compensated whenever he or she is working. 29 U.S.C. § 203(g); 29 C.F.R. § 785.11. An employee’s time spent “walking, riding, or traveling to and from the actual place of performance of the [employee’s] principal activity or activities,” however, is not compensable time under the Portal-to-Portal Act, see 29 U.S.C. § 254(a), and this applies whether the employee works at a fixed location or different job sites.” 29 C.F.R. § 785.35. But “travel from [a] designated place,” such as a yard, “to the work place is part of the day’s work, and must be counted as hours worked,” 29 C.F.R. § 785.38, when such initial stop involves preliminary activities that are “integral and indispensable to the principal activities that [the] employee is employed to perform.” Integrity Staffing Solutions, Inc. v. Busk, 135 S. Ct. 513, 518-19 (2014). Another important principle is that travel away from home is compensable if it cuts across an employee’s normal working hours, even if on a normally non-working day. 29 C.F.R. § 785.37.

Thus, the result frequently turns on whether preliminary or postliminary activities are integral and indispensable activities, which is not always clear. The DOL has helpfully summarized its position for three specific instances, however.

In Scenario 1, the employer requires the job foreman to drive to a yard to pick up (and at the end of the day, to drop off) a truck before going to a job site in the same city. The laborers on the foreman’s crew may choose to directly to the local job site or can meet the foreman at the yard and ride in the company truck.

The DOL’s position is that the foreman’s drive from the yard to the local job site is compensable because the employer needs the trucks on the job site to move tools and materials around, and the trucks must be secured at the yard at the end of the day for safety and security. With respect to the laborers, regardless of how they choose to travel to the local job site, the DOL’s position is that this is akin to a non-compensable commute.

In Scenario 2, the facts are similar except the job site is remote (1.5-4 hours away). The foreman still must obtain a company truck, and laborers are free to either drive to the remote job site or ride with the foreman. Either way, all employees are provided hotel accommodations and a per diem for the length of the job.

The DOL’s position here is that again, the foreman’s travel time from the yard to the remote job site is compensable for the same reasons as in Scenario 1. The DOL’s position is more nuanced for the laborers: for those laborers that drive themselves to the remote job site, their time is compensable if the travel cuts across their normal work hours, i.e., travel during their normal working schedule (even if it is on a day that would normally be a non-work day). Further, the employer may choose to compensate the laborer for either 1) the amount of actual travel time; or 2) the amount of travel time the laborer would have incurred if he or she had ridden with the foreman. For those laborers that are merely passengers, their time is compensable only if the travel time is during their normal working hours (even if on a non-working day).

In Scenario 3, the facts are the same as in Scenario 2 except the laborers choose to drive from home to the remote job site every day instead of staying in a hotel.

Again, the foreman’s time is compensable for reasons previously stated. The DOL’s position with respect to the laborers is that the first and last day of travel would be treated as in Scenario 2, but during the intervening days, their travel is not compensable. As the DOL notes, the laborers have the choice to use their free time however they choose, and the employer is not penalized if they choose to drive home each day.

The Bottom Line for Employers

The bottom line is that although there are myriad circumstances in which employees may be required to drive, a typical scenario involves foremen and/or laborers traveling together from a yard to a remote location. Although the DOL’s opinion letter is not binding, it serves as an important predictor of how the DOL might view similar travel arrangements. Employers with crews traveling from a centralized yard or home office to other job sites would be wise to consider these scenarios and how the DOL might treat employees’ travel time using these principles.