Search form

Bill Allowing Private Employers to Offer Comp Time Approved by House, Heads to Senate

By Jeffrey W. Brecher and Tony H. McGrath
  • May 3, 2017

Private-sector employers soon may be able to grant compensatory time in lieu of overtime pay to employees.

On May 3, 2017, the House of Representatives passed the Working Families Flexibility Act (H.R. 1180, S. 801) by a vote of 229 to 117. The Act would amend the Fair Labor Standards Act to allow private-sector employers to grant compensatory time (or “comp time”) in lieu of paying overtime to hourly workers. Public-sector employers have had that ability since 1985.

Under federal law, non-exempt employees must receive overtime pay at one-and-one-half times their regular rate of pay for each hour worked over 40 in a workweek. The proposed change would give employees a second option. If the employer and employee agree in writing, the employee can receive 1.5 hours of compensatory time for each overtime hour worked. The employee may use the accrued comp time as paid time off in subsequent weeks, so long as the “use of the compensatory time does not unduly disrupt the operations of the employer.” Proponents of the measure say that accruing compensatory time gives employees more flexibility and helps maintain work-life balance.

The comp time would be paid at the employee’s regular rate of pay during the week in which it was earned, or the week in which it was used, whichever is higher. Employees would be able to accrue up to 160 hours of compensatory time. Employers would be required to cash out accrued compensatory time at the end of each year and at the end of an employee’s employment.

The measure would need to be passed by the Senate, where it would require some Democratic support to avoid a filibuster, and signed by the President before it becomes law. The White House has issued a statement supporting the bill, making it likely that the President would sign it if the bill were approved by the Senate. If enacted, the law would have to be reauthorized after five years, following a study on its impacts and enforcement.

Employers should be mindful that many states have their own overtime laws that may not permit the use of compensatory time.

Jackson Lewis attorneys are available to answer inquiries regarding this and other workplace developments.

©2017 Jackson Lewis P.C. This Update is provided for informational purposes only. It is not intended as legal advice nor does it create an attorney/client relationship between Jackson Lewis and any readers or recipients. Readers should consult counsel of their own choosing to discuss how these matters relate to their individual circumstances. Reproduction in whole or in part is prohibited without the express written consent of Jackson Lewis.

This Update may be considered attorney advertising in some states. Furthermore, prior results do not guarantee a similar outcome.

Jackson Lewis P.C. represents management exclusively in workplace law and related litigation. Our attorneys are available to assist employers in their compliance efforts and to represent employers in matters before state and federal courts and administrative agencies. For more information, please contact the attorney(s) listed or the Jackson Lewis attorney with whom you regularly work.

See AllRelated Articles You May Like

November 15, 2017

2018 Minimum Wage Rate Increases: Are You Ready?

November 15, 2017

The federal minimum wage has remained stagnant at $7.25 an hour since 2009. In the absence of an increase to the federal minimum wage, an increasing number of states, cities, and other municipalities have enacted statutes providing for minimum wage rates in excess of (and, in some cases, more than twice as high as) the federal rate.... Read More

November 14, 2017

New York Department of Labor Proposes Scheduling Regulations

November 14, 2017

Big changes may be in store for employers in New York who require employees to be “on call” or who are accustomed to making quick changes to employee schedules, including canceling shifts when customer or client demand changes. On November 10, 2017, the New York State Department of Labor (NYDOL) released the text of anticipated... Read More

November 8, 2017

New York City Issues Proposed Rules for Fast Food, Retail Workers Scheduling Law

November 8, 2017

The New York City Department of Consumer Affairs (DCA) has issued proposed rules for the implementation of the Fair Workweek Law in an attempt to clarify and assist employers with compliance. The Law is intended to reform scheduling practices for fast food and retail workers in the City and will go into effect on November 26, 2017.... Read More

Related Practices