What employee training time needs to be paid?

Non-exempt (overtime eligible) employees are entitled to pay for all hours worked for their employer. Under the rules, this means pay is required for all hours spent performing work for the employer, even if it is not required. Work is “suffered or permitted” when an employer is aware that additional work is performed (beyond scheduled hours), accepts the benefit and does not take action to stop it. So generally, an employee is compensated for all the hours spent working on their “principal activity” at work, which may extend beyond normal working hours, and away from the workplace. Today, there are so many professions that require special training and certification. This means lots of questions about the compensability of employee training. When is an employer required to pay for employee training time?

Four factors to consider:  According to regulations from the Wage and Hour Division, employee training at lectures, meetings and training programs does not need to be paid (or counted as hours worked) only if four (4) specific criteria are met: (1) the training is outside regular work hours; (2) it is voluntary; (3) it is not directly related to the employee’s job; and (4) the employee does not perform any productive work during the training.

For example (from the regulations), training is not considered directly related to an employee’s job when it is teaching them a new skill, trade or profession. So for instance, an employee taking an online course (after work hours) on medical coding, that is not geared toward their performance as a receptionist is not directly related to the job. Where a training course is instituted for the bona fide purpose of preparing for advancement through upgrading the employee to a higher skill, and is not intended to make the employee more efficient in present job, it is not considered directly related, even though it may incidentally improve their general skill level.

Independent training and educational courses taken by an employee after hours, on their own initiative (even if related to their present job) is not considered hours worked. For example, an employee taking an online accounting class at USF to improve their skills, when it is not required by the employer.

Lastly, the regulations explain that certain “special situations” are also not compensable training. When an employer establishes a training program for the benefit of employees which corresponds to courses offered by independent bona fide institution of learning, voluntary attendance by an employee at such courses outside of working hours would not be worked hours even when they are directly related to his or her job, or paid by the employer. There is also a special provision for apprenticeship training.

Example One: What about child care center employees in State-mandated training programs, offered by the employer and required of the employee as a condition of maintaining her State certificate? As long as in service training/continuing educaiton (which was comparable to courses offered by bona fide institutions of learning) was offered outside work hours, employees could choose to attend and no productive work done – FLSA Administrator opined that it was not compensable training time.

Example two: Are technicians required to be paid for the time spent completing several web based training courses that were pre-requisites for attending company paid training on several new products. The online training was voluntary and not required in order to perform their present position. The pre-qualification sessions would take an estimated 10 hours to complete. FLSA Administrator opined that this time must be compensated because if completed because the pre-requisite sessions were directly related to the employee’s present job and were not courses offered by general bona fide learning institutions (too product specific).

HR for Business – Consultstu LLC provides fractional HR services to small/mid businesses, and helps companies minimize HR costs and improve HR efficiency.  It assists clients with customized HR solutions that provide protection from expensive HR mistakes and strategies for improving employee engagement.  Contact Stuart Charlson at 727-350-0370, or email[email protected]

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