Earlier this year, the Department of Labor (DOL) published three opinion letters addressing travel under the FLSA, compensation for 15-minute rest breaks required by an employee’s serious health condition, and lump-sum payments from employers to employees under Title III of the Consumer Credit Protection Act.
An opinion letter is an official, written opinion by the Wage and Hour Division on how a particular law applies in specific circumstances presented by the person or entity requesting the letter. Opinion letters represent official statements of agency policy.
FLSA travel. The first opinion letter, signed by Acting Administrator Bryan L. Jarrett, responded to an inquiry about the compensability of travel time for hourly technicians under the FLSA. The letter underscores the WHD’s position on several issues, including these:
- Where an employee "is offered public transportation but requests permission to drive his [or her] car instead, the employer may count as hours worked either the time spent driving the car or the time he [or she] would have had to count as hours worked during working hours if the employee had used the public conveyance."
- When an employee is temporarily working at a fixed remote location, "generally, the travel time from the hotel to the work site and back would be considered ordinary home-to-work travel, and, as such, need not be compensated."
- Compensable worktime generally does not include time spent commuting between home and work, even when the employee works at different job sites. Travel between job sites after arriving at work, however, is compensable.
- As to commuting time, a company-provided vehicle does not, alone, make an ordinary commute compensable, provided that "the use of such vehicle for travel is within the normal commuting area for the employer’s business or establishment, and the use of the employer’s vehicle is subject to an agreement on the part of the employer and the employee or representative of such employee."
Health condition-required rest breaks. The second letter, also signed by Jarrett, responded to a request for an opinion as to "[w]hether a nonexempt employee’s 15-minute rest breaks, which are certified by a health care provider as required every hour due to the employee’s serious health condition and are thus covered under the FMLA, are compensable or noncompensable time under the FLSA."
Rest breaks up to 20 minutes in length are generally compensable because the breaks predominantly benefit the employer, according to the opinion letter. However, the specific FMLA-protected breaks described in the inquiry differ significantly from ordinary rest breaks commonly provided to employees. Here, the 15-minute breaks "are required eight times per day and solely due to the needs of the employee’s serious health condition as required under the FMLA."
Because these FMLA-protected breaks are given to accommodate the employee’s serious health condition, the breaks predominantly benefit the employee and are noncompensable, the letter states. This conclusion comports with both regulations and case law. Moreover, the text of the FMLA itself further confirms that employees are not entitled to compensation for the FMLA-protected breaks at issue. The FMLA expressly provides that FMLA-protected leave may be unpaid, and it provides no exceptions for breaks up to 20 minutes in length.
That said, the letter goes on to stress that employees who take FMLA-protected breaks must receive as many compensable rest breaks as their coworkers receive. Thus, if an employer generally allows all of its employees to take two paid 15-minute rest breaks during an eight-hour shift, an employee needing 15-minute rest breaks every hour due to a serious health condition should likewise be compensated for two 15-minute rest breaks during his or her eight-hour shift.
Garnishment of lump-sum payments. The third letter, signed by Senior Policy Advisor Keith Sonderling, addresses the question of whether certain lump-sum payments from employers to employees are considered earnings for the purpose of garnishment under Title III of the Consumer Credit Protection Act (CCPA).
The opinion letter states that in assessing whether certain lump-sum payments are earnings and subject to CCPA garnishment limitations, "the central inquiry is whether the amounts are paid by the employer in exchange for personal services." When the lump-sum payment is made in exchange for personal services rendered, it will be subject to the CCPA’s garnishment limitations (as described in Fact Sheet #30: The Federal Wage Garnishment Law, Consumer Credit Protection Act’s Title III). "Conversely, lump-sum payments that are unrelated to personal services rendered are not earnings under the CCPA," according to the letter.
The WHD considers that the following lump-sum payments (as specifically defined in the text of the letter) are earnings under the CCPA: commissions; discretionary and nondiscretionary bonuses; productivity or performance bonuses; profit-sharing, referral, and sign-on bonuses; moving or relocation incentive payments; attendance, safety, and cash service awards; retroactive merit increases; payment for working during a holiday; workers’ compensation payments for wage replacement; termination pay (e.g., payment of last wages, as well as any outstanding accrued benefits); severance pay; and back-pay and front-pay payments from insurance settlements.
The letter also stated that the following lump-sum payments (as specifically described in the inquiry to which the letter responds) are not earnings under the CCPA: workers’ compensation payments for medical reimbursements; wrongful termination insurance for compensatory or punitive damages; and buybacks of company shares.
Source: CCH/Wolters Kluwer