DOL Guidance Reminds Employers to Track Teleworking Employee Hours

As many employers struggle with the realistic possibility that remote work will continue into the foreseeable future, on August 24, 2020, the United States Department of Labor (“DOL”) Wage and Hour Division (“WHD”) issued a Field Assistance Bulletin (“FAB”) that addressed employers’ obligations to exercise reasonable diligence when tracking remote employees’ hours.

Existing law provides that employers must pay employees for all hours worked, regardless of whether the work was requested or permitted by the employer. See 29 C.F.R. § 78511-12. Under the Fair Labor Standards Act (“FLSA”), compensable time is that which the employer knew about or had reason to believe was worked by the employee. The employers’ knowledge of hours worked can be actual or constructive. Employers are presumed to have actual knowledge of an employee’s regularly scheduled hours when teleworking and actual knowledge of any additional time reported by the employee. Under the FLSA, an employer has constructive knowledge of any additional working hours that the employer should have known about through “reasonable diligence.”

According to the August 24 FAB, an employer may show reasonable diligence in tracking employee hours by “providing a reasonable reporting procedure for non-scheduled time.” In pertinent part, the FAB provided that “[i]f an employee fails to report unscheduled hours worked through such a procedure, the employer is not required to undergo impractical efforts to investigate further to uncover unreported hours of work and provide compensation for those hours.” The FAB affirmed that employers are not, for example, required to cross-reference timesheets with accessible data, such as employee emails or phone records to determine if work was performed outside of the reported hours. This presumption of reasonable diligence however will not exist where the employer prevents or discourages an employee from accurately reporting all hours worked. Further, while impractical investigations are not required, records of emails and phone calls by employees could be evidence of employer constructive knowledge if the employer knew of those communications outside of the reported hours. Finally, the WHD reiterated a long-standing legal principle that employees cannot waive their right to compensation for time worked and any such agreement by an employee is void and unenforceable.

In these uncertain times, with many workplaces transitioning to allow for remote work, regardless of whether that transition is temporary or permanent, the WHD has provided an important reminder—employer timekeeping obligations remain the same whether the employee works at the office or at home. Understandably, employers struggle with tracking teleworking employee time, but WHD has emphasized the importance of having reasonable reporting methods, which are clearly communicated to employees, easily understood, and regularly utilized to track time worked.

If you are an employer and have questions about tracking employee hours, please contact Lisa Reimbold or another member of Clark Hill’s Labor and Employment Practice Group.