Travel And Payroll
Travel And Payroll
For some industries, travel is a must. Companies have to travel to meet clients or deliver a product. It could be for training or picking up lunch for the office. Travel could be down the road or across the country. The question that many have though is how do you pay your employee for travel? Rather the employee is in the office or across the country it’s still a part of a company’s payroll. It should be noted this article covers the payroll aspect of travel. It does not cover how to reimburse an employee for expenses.
That answer could be simple to complicated. The simple part comes from salary employees. Since they’re salary, you don’t have to worry about paying them for travel. It’s when you have wage employees traveling it gets complicated. What parts of their travel do you pay them hourly for?
Before we get into that, we should talk about commuting. Commuting is the travel between home and the workplace. This is not considered work in most cases so it is not paid. The one exception is when an employee is called to work outside of normal hours. If they have to come to work after already clocking out for the day, this commute would be considered work.
Now let’s start with a simple situation. An employee doing work related driving during normal hours. Because it’s related to work and during work hours, all drive time is considered on the clock. It doesn’t have to exactly be work related either. If you as an employer send an employee to pick up donuts during work hours, that is still work time. That is where the simple explanations end and things get more complicated.
Let’s look at traveling out of town for a day. In these cases, the employee is paid for travel time during work hours. Yet, normal commute time can be deducted from this. For example, if it takes someone 15 minutes to drive to work every morning. One day though, they are sent to a town 2 hours away for a special job. If the employee leaves from the office, they are paid for the full 2 hours of travel. If they travel from home to the out of town site, the employer can deduct the normal 15-minute commute. Only paying them for 1 hour and 45 minutes. The same goes for the drive home.
If an employee travels out of town during non-work hours the pay is different. Federal law only requires they be paid for travel time done during work hours. Work hours are their normal work schedule. If they work from 8 A.M. to 5 P.M. with a 30-minute lunch break every day, that is what they get paid for when traveling. There is no set work time. It’s their normally scheduled work shift. Time spent traveling outside of a regular workday does not count. The exception is if work is being performed. For example, if an employee is taking a train and works from a laptop. Rather it takes place during work hours or after, the employee must be paid.
This law also counts for non-work days. Let’s say an employee has weekends off. An emergency comes up that requires the employee to leave town for work on Saturday. Even though it’s not a work day, normal hours still apply. They are only paid from 8 A.M. to 5 P.M. with a 30-minute lunch.
That covers time, but what about expenses? Click here to read our article Reimbursing Travel Expenses.
