By Rob Gilmore & Kirsten Mooney
On August 24, 2020, the Department of Labor’s Wage and Hour Division (WHD) issued Field Assistance Bulletin No. 2020-5 regarding employers’ continuing obligations to track employees’ telework hours. In a time where telework is becoming more and more common, especially due to needs created by the COVID-19 pandemic, the WHD reminds employers of its obligation to track compensable hours worked by those non-exempt employees teleworking. Specifically, the Bulletin clarifies how, and to what extent, employers must monitor the hours of those non-exempt, remote employees.
The Fair Labor Standards Act (FLSA) generally requires employers to compensate employees for all hours worked, including overtime hours. This includes “work not requested but suffered or permitted” as well as work performed away from an employer’s worksite or premises (e.g. telework from an employee’s home). See 29 C.F.R. § 785.11-.12. It is the employer’s duty to exercise control to ensure that employees are not performing work unintended to be performed. The Bulletin confirms this obligation, adding that “[e]mployers must… pay for all work they know about, even if they did not ask for the work, even if they did not want the work done, and even if they had a rule against doing the work.”
However, the Bulletin clarifies that an employer’s obligation is not unlimited. An employer is not obligated to pay for “work it did not know about, and had no reason to know about.” The Bulletin states:
“For telework and remote work employees, the employer has actual knowledge of the employees’ regularly scheduled hours; it may also have actual knowledge of hours worked through employee reports or other notifications. The FLSA’s standard for constructive knowledge in the overtime context is whether an employer has reason to believe work is being performed….An employer may have constructive knowledge of additional unscheduled hours worked by their employees if the employer should have acquired knowledge of such hours through reasonable diligence.”
The Bulletin provides that one way an employer may satisfy this standard of “reasonable diligence” is to establish a reasonable reporting procedure for an employee’s unscheduled and/or uncompensated work time. Although the employer may not implicitly or explicitly discourage accurate reporting, employers are not required to further investigate if an employee fails to report. Importantly, the Bulletin also makes clear that an employer does not have to go so far as to take impractical efforts in order to determine whether its employees worked hours beyond those reported. For example, employers with a reporting method for unpaid work are not required to additionally search a teleworking employee’s log-on records, email time stamps, or other administrative records in order to discover any unscheduled or unreported work hours.
With all of the above in mind, here are a few key takeaways from the Bulletin:
- Employers should provide notice to employees of any policies prohibiting them from working unauthorized overtime. However, please note that these policies, alone, are not enough. Even if an employee performs work in violation of such a policy, the employer may still have to compensate them for the time worked.
- Employers should provide employees with reasonable reporting procedures to document unscheduled or uncompensated time. Telework employees should be trained on how to use these reporting procedures, so that they can properly track their time. Overtime work must be compensated, regardless of where worked.
- Employers should investigate and address instances of unauthorized work. They should compensate employees for all hours worked that they do know or should know about. Non-exempt employees who repeatedly perform unauthorized work may be potentially disciplined, but they may not be unpaid.
- Telework employees should not be given free rein on when to work and how much work to complete. Clear communication about expectations for scheduled work is a best practice.
For more information on this recent telework guidance, please contact Rob Gilmore (rsg@kjk.com / 216-736-7240) or Kirsten Mooney (kbm@kjk.com / 216-736-7239) or any of KJK’s Labor & Employment professionals.