Please see Families First Coronavirus Response Act: Questions and Answers for questions specific to the application of the Families First Coronavirus Response Act and paid leave. 

If your business has a shortage of workers and is looking to “volunteers” to help out, be aware that the Fair Labor Standards Act (FLSA) has stringent requirements with respect to the use of volunteers.  In general, covered, nonexempt workers working for private, for-profit employers have to be paid at least the minimum wage and cannot volunteer their services.  Check with DOL for the rules governing the circumstances where volunteering in the public and private, non-profit sectors may be allowed.

If you have been laid off and have not received your last paycheck, immediate payment may be required by state law (although it is not required by federal law).  If your regular payday has passed without payment, contact the DOL’s Wage and Hour Division or your state labor office.

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  1. How many hours is an employer obligated to pay an hourly-paid employee who works a partial week because the employer’s business closed?
  2. If an employer directs salaried, exempt employees to take vacation (or leave bank deductions) or leave without pay during office closures due to influenza, pandemic, or other public health emergency, does this impact the employee’s exempt status?
  3. What are an employer’s obligations to an employee who is under government-imposed quarantine?
  4. How many hours per day or per week can an employee work?
  5. Can an employee be required to perform work outside of the employee's job description?
  6. If individuals volunteer to a public agency, are they entitled to compensation?
  7. If individuals volunteer to a private, not-for-profit organization, are they entitled to compensation?
  8. May an employer encourage or require employees to telework (i.e., work from an alternative location such as home) as an infection control strategy?
  9. Do employers have to pay employees their same hourly rate or salary if they work at home?
  10. In the event an organization bars employees from working from their current place of business and requires them to work at home, will employers have to pay those employees who are unable to work from home?
  11. Are businesses and other employers required to cover any additional costs that employees may incur if they work from home (internet access, computer, additional phone line, increased use of electricity, etc.)?
  12. Do OSHA’s regulations and standards apply to the home office? Are there any other Federal laws employers need to worry about if employees work from home?
  13. In the event an employer brings on temporary employees from a staffing agency to supplement its workforce due to staffing shortages, is the employer liable if the temporary employees are not paid in accordance with the wage requirements of the FLSA?
  14. I am an employer who allows my employees to telework during the COVID-19 emergency. Now that my employees are no longer at my worksite, how do I determine their hours of compensable work? Do I have to pay my employees for hours I did not authorize them to work? Do I have to pay them for hours worked even when they do not report those hours? (added 07/20/2020)
  15. I am an employer who allows my employees to telework during the COVID-19 emergency. I would also like to give my employees flexibility in hours of work so they can take time out of the normal workday for personal and family obligations, such as caring for their children whose schools have closed. If I allow my employees to begin work, take several hours in the middle of the workday to care for their children, and then return to work, do I have to compensate them for all of the hours between starting work and finishing work? (added 07/20/2020)
  16. Can a salaried executive, administrative, or professional employee who is exempt from the Fair Labor Standards Act’s (FLSA’s) minimum wage and overtime requirements under Section 13(a)(1) perform other nonexempt duties during the COVID-19 public health emergency and continue to be treated as exempt? (added 07/20/2020)
  17. Is hazard pay required under the Fair Labor Standards Act (FLSA) for employees working during the COVID-19 pandemic? (added 07/20/2020)
  18. I am a salaried employee exempt from the minimum wage and overtime pay requirements under Section 13(a)(1) of the Fair Labor Standards Act (FLSA) as a bona fide executive, administrative, or professional employee. Will I lose my exempt status if I take leave under the Families First Coronavirus Response Act (FFCRA)? (added 07/20/2020)
  19. I am a salaried employee exempt from the minimum wage and overtime requirements under Section 13(a)(1) of the Fair Labor Standards Act (FLSA) as a bona fide executive, administrative, or professional employee. Can my employer reduce my salary during the COVID-19 pandemic or an economic slowdown? Would I lose my exempt status if my employer does? (added 07/20/2020)
  20. I am an employee of a private employer that began paying me incentive payments, such as hazard pay, for working during the COVID-19 emergency. Do those incentive payments have to be included in the regular rate that is used to compute my overtime pay? (added 08/27/2020)
  21. I am an employee of a state or local government that began paying me incentive payments, such as hazard pay, for working during the COVID-19 emergency. Does my government employer have to include such incentive payments in the regular rate that is used to compute my overtime pay? (added 08/27/2020)
  22. I am a private employer. My state or local government has a program that allows my employees to apply for and receive incentive payments, such as hazard pay, for working during the COVID-19 emergency. I am not involved in developing the program or in disbursing the government-provided incentive payments. Do I need to include such incentive payments in the regular rate that is used to compute employees’ overtime pay? (added 08/27/2020)
  23. I am a private employer. My state or local government indirectly provides incentive payments, such as hazard pay, to my employees for working during the COVID-19 emergency by using me as an intermediary. The government provides me with the payments, which I disburse to my employees. Do I need to include such pay in the regular rate that is used to compute overtime pay for my employees? (added 08/27/2020)
  24. As a private employer, how do I know if my employees and I have implicitly agreed to treat government-provided incentive payments for working during the COVID-19 emergency as compensation for employment? (added 08/27/2020)
  25. I am an employee of a private employer that began paying me incentive payments, such as hazard pay, for working during the COVID-19 emergency. Do those incentive payments have to be included in the regular rate that is used to compute my overtime pay? (added 09/21/2020)
  26. I am an employee of a state or local government that began paying me incentive payments, such as hazard pay, for working during the COVID-19 emergency. Does my government employer have to include such incentive payments in the regular rate that is used to compute my overtime pay? (added 09/21/2020)
  27. I am a private employer. My state or local government has a program that allows my employees to apply for and receive incentive payments, such as hazard pay, for working during the COVID-19 emergency. I am not involved in developing the program or in disbursing the government-provided incentive payments. Do I need to include such incentive payments in the regular rate that is used to compute employees’ overtime pay? (added 09/21/2020)
  28. I am a private employer. My state or local government indirectly provides incentive payments, such as hazard pay, to my employees for working during the COVID-19 emergency by using me as an intermediary. The government provides me with the payments, which I disburse to my employees. Do I need to include such pay in the regular rate that is used to compute overtime pay for my employees? (added 09/21/2020)
  29. As a private employer, how do I know if my employees and I have implicitly agreed to treat government-provided incentive payments for working during the COVID-19 emergency as compensation for employment? (added 09/21/2020)

1. How many hours is an employer obligated to pay an hourly-paid employee who works a partial week because the employer’s business closed?

The FLSA generally applies to hours actually worked.  It does not require employers who are unable to provide work to non-exempt employees to pay them for hours the employees would have otherwise worked.

2. If an employer directs salaried, exempt employees to take vacation (or leave bank deductions) or leave without pay during office closures due to influenza, pandemic, or other public health emergency, does this impact the employee’s exempt status?

Exempt, salaried employees generally must receive their full salary in any week in which they perform any work, subject to certain very limited exceptions.  The FLSA does not require employer-provided vacation time. Where an employer offers a bona fide benefits plan or vacation time to its employees, there is no prohibition on an employer requiring that such accrued leave or vacation time be taken on a specific day(s). Further, this will not affect the employee’s salary basis of payment so long as the employee still receives in payment an amount equal to the employee’s guaranteed salary. However, an employee will not be considered paid “on a salary basis” if deductions from the predetermined compensation are made for absences occasioned by the office closure during a week in which the employee performs any work. Exempt salaried employees are not required to be paid their salary in weeks in which they perform no work.

Therefore, a private employer may direct exempt staff to take vacation or debit their leave bank account in the case of an office closure, whether for a full or partial day, provided the employees receive in payment an amount equal to their guaranteed salary. In the same scenario, an exempt employee who has no accrued benefits in the leave bank account, or has limited accrued leave and the reduction would result in a negative balance in the leave bank account, still must receive the employee’s guaranteed salary for any absence(s) occasioned by the office closure in order to remain exempt. For more information, see WHD Opinion Letter FLSA2005-41.

3. What are an employer’s obligations to an employee who is under government-imposed quarantine?

WHD encourages employers to be accommodating and flexible with workers impacted by government-imposed quarantines. Employers may offer alternative work arrangements, such as teleworking, and additional paid time off to such employees.

4. How many hours per day or per week can an employee work?

The FLSA does not limit the number of hours per day or per week that employees aged 16 years and older can be required to work.

5. Can an employee be required to perform work outside of the employee's job description?

Yes.  The FLSA does not limit the types of work employees age 18 and older may be required to perform.  However, there are restrictions on what work employees under the age of 18 can do.  This is true whether or not the work asked of the employee is listed in the employee's job description.

As part of your pre-influenza, pandemic, or other public health emergency planning, you may want to consult your human resource specialists if you expect to assign employees work outside of their job description during a pandemic or other public health emergency.  You may also wish to consult bargaining unit representatives if you have a union contract.

6. If individuals volunteer to a public agency, are they entitled to compensation?

Individuals who volunteer their services to a public agency (such as a state, parish, city or county government) in an emergency capacity are not considered employees due compensation under the FLSA if they:

  • Perform such services for civic, charitable or humanitarian reasons without promise, expectation, or receipt of compensation. The volunteer performing such service may, however, be paid expenses, reasonable benefits or a nominal fee to perform such services; and,
  • Offer their services freely and without coercion, direct or implied; and,
  • Are not otherwise employed by the same public agency to perform the same services as those for which they propose to volunteer.

7. If individuals volunteer to a private, not-for-profit organization, are they entitled to compensation?

Individuals who volunteer their services in an emergency relief capacity to private not-for-profit organizations for civic, religious or humanitarian objectives, without contemplation or receipt of compensation, are not considered employees due compensation under the FLSA.  However, employees of such organizations may not volunteer to perform on an uncompensated basis the same services they are employed to perform.

Where employers are requested to furnish their services, including their employees, in emergency circumstances under Federal, state or local general police powers, the employer’s employees will be considered employees of the government while rendering such services.  No hours spent on the disaster relief services are counted as hours worked for the employer under the FLSA.

8. May an employer encourage or require employees to telework (i.e., work from an alternative location such as home) as an infection control strategy?

Yes. An employer may encourage or require employees to telework as an infection-control or prevention strategy, including based on timely information from public health authorities about pandemics, public health emergencies, or other similar conditions. Telework also may be a reasonable accommodation.

Of course, employers must not single out employees either to telework or to continue reporting to the workplace on a basis prohibited by any of the EEO laws. (See the U.S. Equal Employment Opportunity Commission’s publication, Work at Home/Telework as a Reasonable Accommodation, for additional information.)

9. Do employers have to pay employees their same hourly rate or salary if they work at home?

If telework is being provided as a reasonable accommodation for a qualified individual with a disability, or if required by a union or employment contract, then you must pay the same hourly rate or salary.

If this is not the case and you do not have a union contract or other employment contracts, under the FLSA employers generally have to pay employees only for the hours they actually work, whether at home or at the employer’s office.  However, the FLSA requires employers to pay non-exempt workers at least the minimum wage for all hours worked, and at least time and one half the regular rate of pay for hours worked in excess of 40 in a workweek.  Salaried exempt employees generally must receive their full salary in any week in which they perform any work, subject to certain very limited exceptions.

If the Service Contract Act (SCA) or state or local laws regulating the payment of wages also apply, nothing in the FLSA or its regulations or interpretations overrides or nullifies any higher standards provided by such other laws or authority. (See the U.S. Department of Labor, Wage and Hour Division for additional information on the SCA or call 1-866-487-9243.)

10. In the event an organization bars employees from working from their current place of business and requires them to work at home, will employers have to pay those employees who are unable to work from home?

Under the FLSA, employers generally only have to pay employees for the hours they actually work, whether at home or at the employer’s office.  However, employers must pay at least the minimum wage for all hours worked, and at least time and one half the regular rate of pay for hours worked in excess of 40 in a workweek.  Salaried exempt employees must receive their full salary in any week in which they perform any work, subject to certain very limited exceptions.  (See the U.S. Department of Labor Wage and Hour Division for additional information or call 1-866-487-9243 if you have questions.)

When not all employees can work from home, we encourage you to consider additional options to promote social distancing, such as staggered work shifts.

11. Are businesses and other employers required to cover any additional costs that employees may incur if they work from home (internet access, computer, additional phone line, increased use of electricity, etc.)?

Employers may not require employees who are covered by the FLSA to pay or reimburse the employer for such items that are business expenses of the employer if doing so reduces the employee's earnings below the required minimum wage or overtime compensation.  (See the U.S. Department of Labor Wage and Hour Division for additional information or call 1-866-487-9243 if you have questions.)

Employers may not require employees to pay or reimburse the employer for such items if telework is being provided to a qualified individual with a disability as a reasonable accommodation under the Americans with Disabilities Act.  (See the U.S. Equal Employment Opportunity Commission’s publication, Work at Home/Telework as a Reasonable Accommodation, for additional information.)

12. Do OSHA’s regulations and standards apply to the home office? Are there any other Federal laws employers need to worry about if employees work from home?

The Department of Labor’s Occupational Safety and Health Administration (OSHA) does not have any regulations regarding telework in home offices.  The agency issued a directive in February 2000 stating that the agency will not conduct inspections of employees' home offices, will not hold employers liable for employees' home offices, and does not expect employers to inspect the home offices of their employees.  If OSHA receives a complaint about a home office, the complainant will be advised of OSHA's policy.  If an employee makes a specific request, OSHA may informally let employers know of complaints about home office conditions, but will not follow-up with the employer or employee.

Employers who are required to keep records of work-related injuries and illnesses will continue to be responsible for keeping such records for injuries and illnesses occurring in a home office.

The FLSA and its implementing regulations do not prevent employers from implementing telework or other flexible work arrangements allowing employees to work from home.  Employers would still be required to maintain an accurate record of hours worked for all employees, including those participating in telework or other flexible work arrangements; and to pay no less than the minimum wage for all hours worked and to pay at least one and one-half times the employee’s regular rate of pay for all hours worked over 40 in a workweek to non-exempt employees.

Employers are encouraged to work with their employees to establish hours of work for employees who telework and a mechanism for recording each teleworking employee’s hours of work.  Non-exempt employees must receive the required minimum wage and overtime pay free and clear. This means that when a covered employee is required to provide the tools and equipment (e.g., computer, internet connection, facsimile machine, etc.) needed for telework, the cost of providing the tools and equipment may not reduce the employee’s pay below that required by the FLSA.  (See the U.S. Department of Labor Wage and Hour Division for additional information or call 1-866-487-9243 if you have questions.)

Under the Americans with Disabilities Act, telework could be a reasonable accommodation the employer would need to provide to a qualified individual with a disability, barring any undue hardship.  However, an employer may instead offer alternative accommodations as long as they would be effective.  (See the U.S. Equal Employment Opportunity Commission’s publication, Work at Home/Telework as a Reasonable Accommodation, for additional information.)

13. In the event an employer brings on temporary employees from a staffing agency to supplement its workforce due to staffing shortages, is the employer liable if the temporary employees are not paid in accordance with the wage requirements of the FLSA?

Under the FLSA, an employee may be employed by one or more individuals or entities.  If one or more of these employers are deemed joint employers, they may both be responsible—and jointly and severally liable—for the employee’s required minimum wage and overtime pay. The U.S. Department of Labor recently updated and revised its regulations providing guidance regarding joint employer status under the FLSA. The final rule provides updated guidance for determining joint employer status when an employee performs work for his or her employer that simultaneously benefits another individual or entity. The effective date of the final rule is March 16, 2020. For more information please visit: https://www.dol.gov/agencies/whd/flsa/2020-joint-employment.

14. I am an employer who allows my employees to telework during the COVID-19 emergency. Now that my employees are no longer at my worksite, how do I determine their hours of compensable work? Do I have to pay my employees for hours I did not authorize them to work? Do I have to pay them for hours worked even when they do not report those hours?

Work performed away from the primary worksite, including at the employee’s home, is treated the same as work performed at the primary worksite for purposes of compensability. Therefore, you must compensate your employee for all hours of telework actually performed away from the primary worksite, including overtime work, in accordance with the FLSA, provided that you knew or had reason to believe the work was performed. This is true even of hours of telework that you did not authorize. You also must compensate your employee for unreported hours of telework that you know or have reason to believe had been performed. However, you are not required to compensate your employee for unreported hours of telework that you have no reason to believe had been performed, i.e., where you neither knew nor should have known about the unreported hours.  In most cases, you may satisfy your obligation to compensate your teleworking employee by providing reasonable time-reporting procedures and compensating that employee for all reported hours.

15. I am an employer who allows my employees to telework during the COVID-19 emergency. I would also like to give my employees flexibility in hours of work so they can take time out of the normal workday for personal and family obligations, such as caring for their children whose schools have closed. If I allow my employees to begin work, take several hours in the middle of the workday to care for their children, and then return to work, do I have to compensate them for all of the hours between starting work and finishing work?

No. Under WHD’s broadly applicable regulation and its continuous workday guidance, all time between the performance of the first and last principal activities of a workday is generally compensable work time. However, the Department recognized that applying this guidance to teleworking arrangement would discourage needed flexibility during the COVID-19 emergency. As such, the Department stated in the Family First Coronavirus Relief Act rulemaking that an employer that allows employees to telework with flexible hours during the COVID-19 emergency does not need to count as hours worked all the time between an employee’s first and last principal activities in a workday. For example, assume you and your employee agree to a telework schedule of 7–9 a.m., 11:30–3 p.m., and 7–9 p.m. on weekdays. This allows your employee, for instance, to help teach their children whose schools are closed, reserving for work times when there are fewer distractions. Of course, you must compensate your employee for all hours actually worked—7.5 hours—that day, but not all 14 hours between your employee’s first principal activity at 7 a.m. and last at 9 p.m.

16. Can a salaried executive, administrative, or professional employee who is exempt from the Fair Labor Standards Act’s (FLSA’s) minimum wage and overtime requirements under Section 13(a)(1) perform other nonexempt duties during the COVID-19 public health emergency and continue to be treated as exempt? 

Yes, during the period of a public health emergency declared by a Federal, State, or local authority with respect to COVID-19, otherwise-exempt employees may temporarily perform nonexempt duties that are required by the emergency without losing the exemption. WHD’s regulations permit an employee who otherwise qualifies for a Section 13(a)(1) exemption to perform nonexempt duties during emergencies that “threaten the safety of employees, a cessation of operations or serious damage to the employer’s property” and which are beyond the employer’s control and could not reasonably be anticipated. COVID-19 is a rare event affecting the public welfare of the entire nation that an employer could not reasonably anticipate and is consistent with the FLSA’s regulatory criteria for emergencies. Employees who are temporarily required to perform nonexempt duties due to COVID-19 may do so without losing the FLSA exemption, as long as they continue to be paid on a salary basis of least $684 per week.

17. Is hazard pay required under the Fair Labor Standards Act (FLSA) for employees working during the COVID-19 pandemic? 

No. The FLSA does not require hazard pay; FLSA generally requires only payment of at least the federal minimum wage (currently $7.25 per hour) for each hour worked and overtime compensation for each hour over 40 worked in a workweek in the amount of at least one and a half times the employee’s regular rate of pay. Issues such as hazard pay are usually determined privately between employers and employees or their authorized representatives. State or local laws may also impose other obligations; you may wish to contact your state labor office to determine whether there are any state laws that address hazard pay. You may locate that office by visiting: https://www.dol.gov/agencies/whd/state/contacts.

18. I am a salaried employee exempt from the minimum wage and overtime pay requirements under Section 13(a)(1) of the Fair Labor Standards Act (FLSA) as a bona fide executive, administrative, or professional employee. Will I lose my exempt status if I take leave under the Families First Coronavirus Response Act (FFCRA)?

No, taking paid sick leave or expanded family and medical leave will not affect your status or eligibility for any exemption from the FLSA’s minimum wage and overtime requirements. For example, if you take paid sick leave or expanded family and medical leave on an intermittent basis, doing so will not be construed as undermining your being paid on a salary basis for purposes of the exemptions under FLSA Section 13(a)(1) and the regulations at 29 CFR Part 541.

19. I am a salaried employee exempt from the minimum wage and overtime requirements under Section 13(a)(1) of the Fair Labor Standards Act (FLSA) as a bona fide executive, administrative, or professional employee. Can my employer reduce my salary during the COVID-19 pandemic or an economic slowdown? Would I lose my exempt status if my employer does?

Generally, an employer may prospectively reduce the amount regularly paid to a salaried exempt employee like you for economic reasons related to COVID-19 or a related economic slowdown. However, any such reduction must be predetermined rather than an after-the-fact deduction from your salary based on your employer’s day-to-day or week-to-week needs. Moreover, any such salary change must also be bona fide, meaning the change is not an attempt to evade the salary basis requirements and is actually because of COVID-19 or an economic slowdown as opposed to the quantity or quality of work you performed.

If your employer properly reduces your salary under these conditions and requirements, you will not lose your exempt status, as long as you still receive on a salary basis at least $684 per week. Please see Fact Sheet #70: Frequently Asked Questions Regarding Furloughs and Other Reductions in Pay and Hours Worked Issues at https://www.dol.gov/agencies/whd/fact-sheets/70-flsa-furloughs for additional information.

20. I am an employee of a private employer that began paying me incentive payments, such as hazard pay, for working during the COVID-19 emergency. Do those incentive payments have to be included in the regular rate that is used to compute my overtime pay?

Yes. Payments your employer provides you to perform work constitutes compensation for employment that must be included in the regular rate, subject to eight exclusions described in section 7(e) of the FLSA. None of those exclusions apply to the incentive payments described above.

21. I am an employee of a state or local government that began paying me incentive payments, such as hazard pay, for working during the COVID-19 emergency. Does my government employer have to include such incentive payments in the regular rate that is used to compute my overtime pay?

Yes. The incentive payments are authorized, managed, and paid for by your government employer as compensation for working during the COVID-19 emergency. As such, the payments are compensation from your government employer that must be included in the regular rate.

22. I am a private employer. My state or local government has a program that allows my employees to apply for and receive incentive payments, such as hazard pay, for working during the COVID-19 emergency. I am not involved in developing the program or in disbursing the government-provided incentive payments. Do I need to include such incentive payments in the regular rate that is used to compute employees’ overtime pay?

No. Under the FLSA, only compensation for employment must be included in the regular rate used to compute overtime pay. Hazard pay and other incentive payments for working during the COVID-19 emergency that the government provides directly to your employees, i.e., without your involvement, are not compensation for employment that must be included in the regular rate.

23. I am a private employer. My state or local government indirectly provides incentive payments, such as hazard pay, to my employees for working during the COVID-19 emergency by using me as an intermediary. The government provides me with the payments, which I disburse to my employees. Do I need to include such pay in the regular rate that is used to compute overtime pay for my employees?

No, unless there is an agreement between you and your employees to treat the government-provided incentive payments for working during the COVID-19 emergency as compensation for employment.

Under the FLSA, only compensation for employment is required to be included in the regular rate used to compute overtime pay. By acting as an intermediary that facilitates these payments, without more, you do not turn government-provided incentive payments for working during the COVID-19 emergency, such as hazard pay, into compensation for employment. However, if you and your employees expressly or implicitly agree to treat the government-provided payments as compensation for employment, then such payments must generally be included in the regular rate.

24. As a private employer, how do I know if my employees and I have implicitly agreed to treat government-provided incentive payments for working during the COVID-19 emergency as compensation for employment?

An implicit agreement to treat government-provided payments for working during the COVID-19 emergency as compensation does not exist merely because you permit your employees to participate in the government’s program (and thus legitimately expect payment). Rather, your involvement in the government’s incentive-payment program must amount to significantly more than serving as a pass through vehicle. Your involvement in the creation, management, and payment of the government program must be so substantial that your employees legitimately understand that you are effectively sponsoring the government-provided incentive payments.

25. I am an employee of a private employer that began paying me incentive payments, such as hazard pay, for working during the COVID-19 emergency. Do those incentive payments have to be included in the regular rate that is used to compute my overtime pay?

Yes. Payments your employer provides you to perform work constitutes compensation for employment that must be included in the regular rate, subject to eight exclusions described in section 7(e) of the FLSA. None of those exclusions apply to the incentive payments described above.

26. I am an employee of a state or local government that began paying me incentive payments, such as hazard pay, for working during the COVID-19 emergency. Does my government employer have to include such incentive payments in the regular rate that is used to compute my overtime pay?

Yes. The incentive payments are authorized, managed, and paid for by your government employer as compensation for working during the COVID-19 emergency. As such, the payments are compensation from your government employer that must be included in the regular rate.

27. I am a private employer. My state or local government has a program that allows my employees to apply for and receive incentive payments, such as hazard pay, for working during the COVID-19 emergency. I am not involved in developing the program or in disbursing the government-provided incentive payments. Do I need to include such incentive payments in the regular rate that is used to compute employees’ overtime pay?

No. Under the FLSA, only compensation for employment must be included in the regular rate used to compute overtime pay. Hazard pay and other incentive payments for working during the COVID-19 emergency that the government provides directly to your employees, i.e., without your involvement, are not compensation for employment that must be included in the regular rate.

28. I am a private employer. My state or local government indirectly provides incentive payments, such as hazard pay, to my employees for working during the COVID-19 emergency by using me as an intermediary. The government provides me with the payments, which I disburse to my employees. Do I need to include such pay in the regular rate that is used to compute overtime pay for my employees?

No, unless there is an agreement between you and your employees to treat the government-provided incentive payments for working during the COVID-19 emergency as compensation for employment.

Under the FLSA, only compensation for employment is required to be included in the regular rate used to compute overtime pay. By acting as an intermediary that facilitates these payments, without more, you do not turn government-provided incentive payments for working during the COVID-19 emergency, such as hazard pay, into compensation for employment. However, if you and your employees expressly or implicitly agree to treat the government-provided payments as compensation for employment, then such payments must generally be included in the regular rate.

29. As a private employer, how do I know if my employees and I have implicitly agreed to treat government-provided incentive payments for working during the COVID-19 emergency as compensation for employment?

It’s not enough that your employees merely expect the payments. And you certainly don’t have an implicit agreement if you’re acting only as a pass-through by, for instance, processing checks or withholding taxes. Instead, you must be doing significantly more to initiate, design, and manage the program. The government programs of which WHD is aware do not, generally speaking, suggest employer involvement to that level, though each situation needs to be determined on its own facts. Of course, if you use the payments to offset your minimum-wage or overtime obligations, then you’re definitely treating them as compensation.

 

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Contact Us

For additional information, visit our Wage and Hour Division Website:  https://www.dol.gov/agencies/whd and/or call our toll-free information and helpline, available 8 a.m. to 5 p.m. in your time zone, 1-866-4USWAGE (1-866-487-9243).

For further information about Coronavirus, please visit the HHS’s Centers for Disease Control and Prevention.