Who is entitled to receive travel time pay?
Only non-exempt employees are entitled to get paid for hours spent in traveling. This includes both hourly and salaried employees.
As a rule of thumb, exempt employees are not entitled to payment for work-related travel. In the case of the U.S., under the Fair Labor Standards Act (FLSA) this includes executive, administrative, professional, computer, and outside sales employees.
Travel time pay rates differ between countries and within the different states in the U.S. In some places, travel rates have to be the same as the rates for regular working hours, or have to be at least the minimum wage rates. However, travel rates can also represent a percentage of the normal pay rates.
Time spent in transportation from one work location to another is generally considered as time that should be paid to employees. With some specific exceptions, time spent in traveling from home to the job location and back is not paid. This is true even in cases when the employee uses an employer-provided vehicle for commuting home and to work.
Paid travel time for non-exempt employees can include the following activities:
- Driving between job sites
- Conducting work activities on a flight, bus, or train
- Completing work-related tasks such as visiting institutions or collecting gear
- Attending workshops, conferences, and events at the request of the employer
- Collecting work tools from another location before the start of the workday at the job location
As for non-exempt overnight travel pay, employers are obliged to pay employees as they would for a normal working day, even if the trip falls on the weekend. The payment should be in addition to covering the travel expenses. The employee is considered on duty since the purpose of the trip is work-related. The usual time used for home-to-work travel (commuting) can be deducted from the total travel hours, since it is not counted as paid work time.
Typically, travel time pay for non-exempt employees is obligatory, applying to both salaried and hourly employees. Exempt employees are considered those providing professional or managerial work.
While time spent in traveling is often clearly included in the logged hours or as overtime for non-exempt salaried employees, the case with hourly employees can be more contentious. Despite that, employees working on an hourly basis should also receive financial compensation for time spent in work-related travel.
For employers working with hourly staff, drive time falls in the category of indirect labor costs. It’s important to know the cases in which such payments are due to make sure you’re following the laws in your location.
A variety of professionals and specialists can be entitled to work-related travel pay, such as:
- Construction contractors - landscaping, maintenance, plumbing, electricity, HVAC, and many more
- Medical care specialists - nurses, home care professionals, etc.
- Service specialists - professional cleaners, caretakers, etc.
The U.S. Department of Labor defines what constitutes travel time, as set in the Fair Labor Standards Act. The specific non-exempt employee travel policies, however, vary based on the state you’re in. In many cases, the state has additional rules regarding travel time pay. When there are both federal and state regulations, it’s advised that employers follow the ones that are more beneficial for the employees.
The State Labor Offices and the Wage and Hour Division Local Offices are the best sources for information on the rules of each state and region regarding travel time pay.
A couple of states have their own additional regulations:
California considers compensable travel time any time which is longer than the usual daily commute of the employee. This applies to overnight out-of-town trips as well. Travel time has to be paid at the agreed regular fixed rates or overtime rates. Employers can set different rates for travel time prior to starting of the job execution, and they cannot be lower than the minimum wage rates.
In the state of New York, the regulations for paying the minimum wage include work-related travel. The wage has to be paid for travel time when traveling is part of the duties of the employee.
Oregon legislation classifies four types of work travel time: portal-to-portal travel, travel between worksites, travel on special one-day assignments, and overnight travel. In general, travel time pay is due for all kinds, except for portal-to-portal travel (work-to-home and home-to-work).
In New Jersey, the Wage and Hour Laws include a fair payment for travel time. When an employee is required to travel between job locations to complete their work, the pay rate is the same as for regular working hours.
The definition of paid travel time in Maryland is similar to the federal one. It includes trips during regular working hours, traveling from one job location to another, and emergency cases home-to-work and back travel.
Nevada law states that any time that qualifies as work travel time should be paid at minimum wage rates, at the least. Any training requested by the employer must be paid as well, as it is considered as work time.
In Canada, travel time can be counted as paid work in certain situations. They include cases when an employee:
- Uses a company vehicle home at the employer’s request
- Transports supplies or other employees to or from job locations
- Has to travel to a different than the usual location for work
- Has to travel between different locations to execute regular work
The guiding principles when evaluating whether travel time has to be paid or not are:
- Travel is inherent for the work
- The work is commissioned and controlled by the employer
- The employee is in charge of work tools or vehicles
As in the U.S., commuting to and from the usual work location is not considered as paid travel time.
The legislative framework in the United Kingdom is similar to those in Canada and the U.S. It is also harmonized with the legislation of the European Union, and more specifically, with the Working Time Directive and a 2015 decision of the European Court of Justice.
Paid time for which the minimum wage is due under UK laws includes any travels in connection with work. Transportation from one work location to another is also counted in the paid hours. However, travel time pay is not needed for commuting to and from the employee’s home.
One of the biggest challenges that business owners face in relation to travel time pay is how to calculate it, so that paychecks are fair, efficient and perfectly calculated.
Most employers don’t cover commuting between employees’ homes and work location, as it’s not legally required, but other instances of work travel have to be added to the employees' timesheets and paid in accordance with applicable laws and the company’s policies.
Hubstaff is a time tracking tool that helps companies easily and automatically track their employees’ hours and locations while they’re on the move. You can monitor deep insights into how much time employees actually spend on the road while on the job. Keep on top of how long your teams spend on the road by recording drive time to jobs with Hubstaff’s GPS time tracking feature.
Even easier, set up geofences for automatic start-and-stop time tracking based on physical job location, so you’ll know not only how long it took your teams to get to work sites but also exactly when they arrived and left.
To make time tracking and invoicing easier, Hubstaff offers additional features like setting different pay rates for travel hours and for work hours. It can also help you deal with the intricacies of overtime pay, as well as plan your employees’ routing and scheduling to optimize travel time and make sure everyone can focus on doing work that really matters.
