What is compensable time?

Compensable time is time the employer must pay for because it counts as hours worked. It often includes more than the hours spent on the main task, like waiting, short breaks and travel between jobs.

In shortCompensable time means hours worked under the Fair Labor Standards Act, which must be paid at least at minimum wage and count toward overtime for non-exempt employees. The federal rules in 29 CFR part 785 sort the gray areas. Work that is not requested but is suffered or permitted is work time (785.11). An employee who is engaged to wait is working (785.15), while time when the employee is completely relieved from duty and can use it effectively for their own purposes is not (785.16). Rest periods of 5 to about 20 minutes count as hours worked (785.18). Normal travel from home to work does not count (785.35), but travel from job site to job site during the workday does (785.38). State laws can add to these rules.

Is it compensable? Common situations

Compensable time, federal baseline
Situation Usually compensable? Rule
Waiting at the job for parts to arrive Yes, engaged to wait 29 CFR 785.15
Sent home for 3 hours, free to leave No, completely relieved 29 CFR 785.16
On call at home, just reachable by phone Generally no 29 CFR 785.17
On call, must stay on the premises Yes 29 CFR 785.17
Coffee break of 10 minutes Yes 29 CFR 785.18
Commute from home to the first site No 29 CFR 785.35
Drive from one job site to the next Yes 29 CFR 785.38

On-call arrangements in between these two ends depend on how restricted the employee really is. See on-call pay and the travel time pay rules.

One field day, 7:00 to 4:30ShopJobsLunchJobs and drivesShopRed: compensable but unpaid under the old ruleGrey: off duty, not compensable
The unpaid minutes were at the start and end of the day, at the shop.

Worked example: a plumber’s day

Counting only time on site

A plumbing company pays its techs from arrival at the first job to departure from the last. One tech’s day: 7:00 at the shop loading parts the dispatcher assigned, 7:45 at the first job, a 30-minute lunch completely off duty, two more jobs with driving in between, done at the last site at 4:00, back at the shop at 4:30 to drop the van.

Paid time was 7:45 to 4:00 minus lunch, or 7.75 hours. Compensable time starts with loading parts at 7:00, since that is part of the job, and runs to 4:30, minus the 30-minute lunch: 9 hours. The gap is 1.25 hours a day. Over 5 days the tech worked 45 hours but was paid for 38.75, so 1.25 hours of straight time and 5 hours of overtime went unpaid.

At $26 an hour, that is 1.25 times $26 plus 5 times $39, or about $228 a week for one tech, before any state penalties.

Mistakes that are specific to compensable time

Meetings, training and travel to training

Time in meetings, lectures and training is hours worked unless all four conditions in 29 CFR 785.27 are met: it is outside regular hours, attendance is truly voluntary, it is not directly related to the job, and the employee does no productive work during it. Required training almost never meets them.

Travel to training follows the travel rules. A trip across town to a required course during the workday is work time. A special one-day trip to another city for training is generally work time, minus the usual commute and meal time.

Second example: a monthly safety meeting

A manufacturer holds a required 30-minute safety meeting at 6:30 a.m. on the first Monday of each month, before the 7:00 shift. Operators are told to attend but are not clocked in until 7:00.

The meeting is required and about the job, so it is hours worked. For 50 operators at $21 an hour, the unpaid time is 50 x 0.5 x $21 = $525 a month, more where it pushes a week over 40. The company starts the meeting day at 6:30 on the clock and records it as paid training time.

Map one real day, minute by minutePick one employee’s typical day and write every block from the first work task to the last: loading, driving, waiting, breaks. Mark each block compensable or not. Most gaps show up in the first and last 30 minutes.

Questions people ask

What is the difference between compensable and non-compensable time?

Compensable time is hours worked that must be paid. Non-compensable time includes normal commuting, bona fide meal periods and time when the employee is completely relieved from duty.

Is travel time compensable?

Normal home-to-work travel is not. Travel between job sites during the workday is. Overnight and special travel have their own rules.

Are breaks compensable?

Rest periods of 5 to about 20 minutes are hours worked. Meal periods of ordinarily 30 minutes or more, with the employee completely relieved from duty, are not.

Is waiting time paid?

If the employee is engaged to wait, yes. If the employee is completely relieved and free to use the time, no.

Is required training time compensable?

Yes. Training that the employer requires, or that is directly related to the job, is hours worked for non-exempt employees.

Is time spent changing into a uniform compensable?

It depends. Putting on required protective gear at work that is integral to the job is generally hours worked. Changing at home generally is not.

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Disclaimer: Treat this guide to compensable time as general information rather than legal, payroll or tax advice: rules vary by location and change, and every example here is fictional.