When is a Commute Not a Commute? In a Company Car (Well, Maybe)!

by Franczek Radelet P.C.

cars.jpgIn my last post, I outlined the “normal” commuting case after Congress passed the Employee Commuting Flexibility Act (ECFA). The ECFA clarified the applicability of the Portal-to-Portal Act to the payment of wages to employees who use employer-provided vehicles. Clarification was necessary because of two conflicting opinion letters on the topic issued by the DOL in 1994 and 1995, respectively. As I mentioned earlier this week, the ECFA made commuting in a company car non-compensable only if the use of the employer’s vehicle was (1) “for travel that is within the normal commuting area for the employer's business or establishment;” and (2) “subject to an agreement on the part of the employer and the employee or representative of such employee.” 29 U.S.C. § 254(a).

Guidance from the DOL confirms this interpretation. In a 1999 Opinion Letter interpreting the ECFA, the DOL stated that a home-based employee traveling in a company van would not need to be compensated for travel from home to a work site unless “the time involved is extraordinary.” The DOL reiterated this stance in 2011. Easy right? Not so fast.

Neither the FLSA nor the ECFA provide further guidance on what constitutes a “normal commuting area” or when time involved is “extraordinary.” The DOL has said a one-hour commute is not compensable, but has not been clear about longer ones. Courts have held that a “normal commute” could be defined by distance or time, or both, and sometimes extended non-compensable commutes to three or four hours in very specific situations. So is there a particular distance that is “safe”? A maximum time? Unfortunately, no. There’s no rule of thumb to follow here.

How Can I Avoid Paying for Every Commute?

If your business relies on non-exempt employees traveling within a territory, what do you do if you don’t want to pay for every commute? Fortunately, there is another set of regulations that provide some guidance. The regulations that apply to federal government employees do define what the federal government considers a “normal commuting area” for duty stations around the country. See 5 C.F.R. § 550.112(j), 551.442(d). The Office of Personnel Management’s (OPM) FLSA regulations for federal employees require that “[w]hen an employee travels directly from home to a temporary duty location outside the limits of his or her official duty station, the time the employee would have spent in normal home to work travel shall be deducted from hours of work.” 5 C.F.R. §422(b).

For instance, a federal employee based in Fairview Heights, Illinois has a duty station that encompasses the cities of O’Fallon, Fairview Heights, Collinsville, as well as the entirety of Bond, Calhoun, Clinton, Jersey, Macoupin, Madison, Monroe and St. Clair Counties. Travel from home to a job site within those cities and counties—no matter how long it may take—would not be compensable time for a federal employee. Travel outside of those cities and counties would be compensable, once you subtract the normal commute (which can be a headache in and of itself). It’s not a perfect solution, but it is one that could carry some weight with the DOL.

Insights for Employers

When should you talk to us? In most situations, if your employees are routinely driving more than one hour to their first job site or more than one hour home from their last job site, or are driving to job sites outside of your normal service area, the time could be considered compensable depending on the specific facts. That’s when you should pick up the phone to call or e-mail. With a little help from OPM and your favorite Franczek Radelet wage and hour attorney, though, you can craft a reasonable solution that should not require you to pay for every commute.


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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