Seyfarth Synopsis: While employers usually don’t need to pay for travel time associated with an employee’s ordinary commute, federal and California law create exceptions that employers should know—particularly when company policy requires a certain type of transportation.
For many of us, automobile traffic—at least during the B.C. (before covid) era—has been as synonymous with California as its sunny weather and ocean beaches. Many businesses have adopted creative policies to help mitigate the stress that traveling employees face, but these policies sometimes create unintended costs by requiring businesses to pay for the travel time.
When Is Travel Time Compensable?
Generally, employees aren’t entitled to pay for their ordinary commute to and from work. There are, however, some notable exceptions under federal and state law.
Federal law, for instance, requires employers to pay for time spent on three types of travel: (1) to another city for a special one-day assignment, (2) to another job site during the workday, and (3) to receive instructions, perform work, or retrieve tools. But federal law doesn’t require employers to pay workers for their time spent commuting in an employer-provided bus or in a mandatory carpool.
On this point, California differs from federal law in an important way. Under the California Supreme Court’s decision in Morillion v. Royal Packing Co., employers must pay for “compulsory travel time”—time employees spend traveling on and waiting for transportation required by an employer. In Morillion, the employees were entitled to pay for travel time because their employer required them to take an employer-provided bus between a designated point and the work site and prohibited them from using their own transportation, even though they were free to pursue personal activities on the bus ride itself.
Also, in California, even if employees use personal vehicles for their commute, they may be entitled to pay for travel time if they are required to carry tools or employer equipment in their vehicles between home and job sites, if they are effectively prevented from using the commute for their own purposes.
These rules about compensable commute time in California have their limits, though. Employers need not pay for the time employees spend traveling on transportation that their employer merely provides but does not require them to use. Similarly, employees aren’t entitled to paid travel time simply because they travel in a company vehicle. However, California law does require employers to pay for travel time if use of a company vehicle is mandatory and is subject to rules that severely restrict the employee’s personal activities, such as prohibiting the employee from making stops or carrying passengers.
For example, a tech company offering an employee shuttle between San Francisco and Silicon Valley probably doesn’t need to pay employees for travel time, so long as the shuttle use is optional and the employees can pursue personal activities during the ride. Conversely, the outcome would likely differ if the employer required employees to meet at a designated spot and take a ride-share vehicle to the work site.
How Is Compensable Travel Time Calculated?
Usually, compensable travel time is calculated at the employee’s hourly rate (with a higher rate for overtime, if applicable). But employers and employees may agree to a separate rate for travel time if they agree before the travel and the separate rate is at least the minimum wage (with a higher rate for overtime, if applicable).
Is Travel Time Between Job Sites Compensable?
Travel time during the workday is usually compensable if the travel is required by the employer. For instance, employees are generally entitled to pay for travel time between different job locations.
But is the entire travel time compensable? Well, it depends. Because employers need only pay for time under their “control,” they need not pay for time associated with an employee’s purely personal pursuits.
Suppose an employee travels an hour and a half between job sites—spending 45 minutes driving and the other 45 minutes getting a haircut or viewing memes online (maybe, even both). The employer must pay only for the 45 minutes of driving time. In practice, however, identifying and segregating purely personal time can be a difficult task.
When Is Temporary Reassignment Compensable?
According to the DLSE, California law requires employers to pay travel time if they require an employee, on a short-time basis, to travel anything more than a minor distance to report to a worksite other than the employee’s usual workplace. This pay is calculated as the additional time (and not distance) normally required to travel between the employee’s home and the regular workplace, and the time between home and the temporary worksite.
But a long-term transfer to a different work site—even if distant—is treated differently. The DLSE has stated that absent any contractual term, employers need not pay for travel time to a new location so long as the transfer lasts more than one month (travel to the new location becomes the employee’s “ordinary commute” after one month).
Remember to Reimburse!
Employers should always remember to reimburse employees when appropriate. Under Labor Code § 2802, employers must reimburse employees for all necessary expenses incurred in connection with employer-required travel. A prime example is reimbursement for mileage for travel between different job locations in a single workday.