Employment Law Alert – DOL Issues New Guidance on Fluctuating Workweek and Expense Reimbursement
September 10, 2020
On August 31, 2020, the U.S. Department of Labor (DOL) issued several new opinion letters addressing compliance issues related to the Fair Labor Standards Act (FLSA). Two letters of particular interest address the fluctuating workweek and expense reimbursement.
FLSA2020-14 restates the DOL’s Wage and Hour Division (WHD’s) long held position that an employee’s work hours do not have to fluctuate above and below 40 hours per workweek in order for an employer to be able to use the fluctuating workweek method of calculating overtime pay. The employee’s hours must simply fluctuate from week to week. WHD also noted that employers using the fluctuating workweek method may not make deductions from an employee’s pay for absences occasioned by the employee. Absences occasioned by the employee include instances where the employee has exhausted a sick leave bank or not yet earned sufficient sick leave to cover an absence due to illness. An exception to the rule regarding deductions exists for occasional disciplinary deductions for willful tardiness or absences or infractions of major work rules.
FLSA2020-12 addresses an employer’s compliance with the FLSA’s minimum wage requirements when reimbursing delivery drivers for business-related expenses incurred while using their personal vehicles during the course of employment. DOL’s WHD stated that:
- Employers are permitted to reimburse a “reasonable approximation” of actual expenses incurred by employees for the benefit of the employer by any appropriate methodology;
- The IRS business standard mileage rate is not legally mandated by WHD regulations but is presumptively reasonable; and
- Whether reimbursement is required for fixed and variable vehicle expenses hinges on whether the cost at issue primarily benefits the employer.
Shulman Rogers Employment and Labor Law attorneys are available to answer questions regarding this Alert or to discuss these topics further.
The contents of this Alert are for informational purposes only and do not constitute legal advice. If you have any questions about this Alert, please contact the Shulman Rogers attorney with whom you regularly work or a member of the Shulman Rogers Employment and Labor Law Group.