Can I Pay My Employees A Lower Rate For Travel Time?
Question: We have out of town jobs that require the employee travel up to 100 miles or so per day, one way, to the job. Is there any provision to create a differential lower rate of pay from their regular working rate, for this travel time?
Answer: Yes. An employer and its employees can agree that such travel time will be paid at a rate of at least minimum wage. Then, for the purpose of establishing the “regular rate of pay” from which an overtime rate is determined, a weighted average of the rate paid for actual work and the rate paid for traveling to the job is computed. That new rate becomes the rate to which time and a half is applied for overtime hours. (By the way, “agree” in this context can mean that the employer adopts a policy which the employees agree to by virtue of continuing to remain employed.)
This response is intended for general informational purposes only and should not be construed as legal advice or a legal opinion, nor is this column a substitute for formal legal assistance. For help with particular legal needs, members are invited to consult with Brooke Duncan III of Adams and Reese LLP. Mr. Duncan can be reached at 504-585-0220 or by email at firstname.lastname@example.org.
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