I just signed my first contract as an hourly, non-exempt employee (had them add that to the contract), with a contracting firm who gets paid by the Company where I work. My job will involve a considerable amount of travel by air and car. Prior to hire, the contracting firm and I discussed that my pay for travel was airport to site/hotel and site/hotel to airport. The Company evidently did not think this out very well and are having second thoughts, and have now informed me that they are writing a policy for their contractors that will state that travel will be paid at 50% of regular hourly wage. Can they do this?
I do not get the Company benefits, so the hourly wage is important to me and figured into why I took this job.
If they can do this, my next question is, how is overtime figured? The state where I am doing the work is Indiana. The contractor is located in another state. Thanks.

I just signed my first contract as an hourly, non-exempt employee (had them add that to the contract), with a contracting firm who gets paid by the Company where I work. My job will involve a considerable amount of travel by air and car. Prior to hire, the contracting firm and I discussed that my pay for travel was airport to site/hotel and site/hotel to airport. The Company evidently did not think this out very well and are having second thoughts, and have now informed me that they are writing a policy for their contractors that will state that travel will be paid at 50% of regular hourly wage. Can they do this?
I do not get the Company benefits, so the hourly wage is important to me and figured into why I took this job.
If they can do this, my next question is, how is overtime figured? The state where I am doing the work is Indiana. The contractor is located in another state. Thanks.
Does your current contract state that you will be paid for that travel time to and from site/hotel and airport?
Overtime is paid for hours over 40 worked in one work week for hourly non exempt employees at 1.5 times their base rate.

In this situation, the contract will prevail, unless there is some sort of clause which would permit them to make changes. Since I don't have the contract, I couldn't say for sure. You should probably see an attorney to discuss the contract.

However, just as an information for you and others who may read this thread, travel time for non-exempt staff is paid as follows under federal law:

Travel to/from an airport or train station and the employee's home is excluded from working time. For overnight travel, employees are to be paid for their normal work schedule, even if he/she is not working the full time. If the employee must work extra hours, over his/her regular schedule, that time must be counted as work time (just as if he/she was working at the home office). If the emploeye is required to drive or ride as an "assistant or helper" in an automobile, the employee must be compensated for all travel time. If the employee is offered the option of public transportation but he/she opts to drive, the employee is paid according to the amount of time had the public transportation alternative been taken.

For persons who are not employees but instead are independent contractor, the paying company can choose the rate it wishes to pay. Let me know if you have any other questions.

My contract states I am a non-exempt employee and will be paid $x per hour for actual hours worked. There is no discussion about travel time in the contract.
I think that my contract covers me, but perhaps the contract that my contracting agency has with the company may be affected by this new policy and I hope they do not ask me to revisit my contract because of this.

They may. I'm not sure what leg you have to stand on, since we don't have a copy of your contract. Good luck and let us know if you have any other questions.

Well I did a little research and seems as though travel time is a dicey issue - some of the rules were posted in the response earlier. If I travel at times other than my regular work time, they do not have to legally pay anything, so I am getting a deal at 50%. If I travel during my regular hours, I should be payed my regular rate. But if I deliver any goods, I could be considered the same as a truck driver, in which case, I do not get overtime because I would fall under the truck driver category. If I deliver goods just once, including paperwork, I am exempt from overtime for the next 4 mos. To figure overtime, the total of my hours is used (even the 50% hours). The pay for that week for the first 40 hrs is added together and the average hourly rate is then used to calculate the time and a half for OT for anything over 40. So, if I travelled 8 hours and worked 36 hrs, and if the last 4 hrs were travel, I would get paid straight time for 36 hrs, 50% for 4 hrs of travel, and would add the pay for those 40 hrs divide by 40 and multiply that number (average hourly rate for the week) by 4 then multiply by 0.5 (for the time and a half) . Yikes - I think I got that right! Next time I will have my contract spell out my hourly travel time pay! :)