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House Passes Comp Time Bill

by Horizon Payroll Solutions on May 11, 2017
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The United States Capitol and reflecting pool in Washington, DC.-314573-edited.jpeg

On Tuesday, the House passed the Working Families Flexibility Act. The Act would amend the Fair Labor Standards Act to allow employees who work more than 40 hours in a workweek to choose between overtime pay in the applicable pay period, as the law requires now, or time off in the future. That time off in the future (comp time) would be banked at the rate of 1.5 hours for each overtime hour worked. For example, an employee who works 44 hours in a workweek could choose between 4 hours of pay at 1.5x their regular rate, or 6 hours of paid time off in their comp time bank.

If it becomes law, it will only apply to states that do not currently have their own overtime laws requiring premium pay for hours over 40 in a workweek.

In states where comp time becomes legal – if it becomes legal at all – it may be used only if the employee chooses comp time instead of overtime pay. Employers will not be able to make comp time a standard practice or in any way coerce employees to choose comp time instead of overtime wages. Additionally, employees will have the option of asking for payout of their unused comp time at any time with 30 days' notice, and unused comp time will have to be paid out at the end of each year. Other limits and worker protections are included as well. Employers will not be required to offer a comp time option.

This bill still needs to pass in the Senate – where it faces an uphill battle – and be signed by the President before it becomes a law.

Topics: overtime, comp time