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Travel Pay California

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  • Travel Pay California

    Hello all,

    I apologize in advance for the length.

    I have gone through several threads prior to posting this. The threads have answered many of our questions about travel pay concerning flights and for our office personal for training. However it is the field personal that does not go to the shop that we have a question on. We do understand that the employees get paid to travel from job to job once they start at a particular site. This question only pertains to getting (Driving) to an out of town project. They take a company a truck when they do this or we will pay their gas if they drive their own car. Any help is much appreiciated.

    We are a construction company based in Southern California. We are now doing jobs as far as 150- to 250 miles away from our shop.

    Being in our location we typically drive upwards of 75 miles to different job sites on a daily basis.

    When our crews stay over we pay for their hotel as well as give them $40 per day for food.

    The questions lies with time spent getting to the job and home again. We do not have anything in writing as far as how far the job needs to be before they can stay over. We are a small shop and always worked it out with the guys, it was usually their choice. Usually around 100 miles was where this discussion started. However, we are growing and with jobs 175 miles away this is surely going to bite us.

    I have read that new projects do not require compensation to the project site but 175 miles is obviously further then a typical commute. We want to be fair with our personal but just need to be legal as well as be correct financially when bidding such projects.

    Without anything in place. and without having a typical starting point as job locations always change, how do we figure this?


  • #2
    The following is from the CA-DLSE manual. See if this helps.

    46.2 Travel Time : If an employee is required to report to the employer’s business premises before proceeding to an off-premises work site, all of the time from the moment of reporting until the employee is released to proceed directly to his or her home is time subject to the control of the employer, and constitutes hours worked. (O.L. 1994.02.16; Morillion v. Royal Packing Co. (2000) 22 Cal.4th 575.

    46.3 Extended Travel Time. The California rule requires wages to be paid for all hours the employee is engaged in travel. The state law definition of “hours worked” does not distinguish between hours worked during “normal” working hours or hours worked outside “normal” working hours, nor does it distinguish between hours worked in connection with an overnight out-of-town assignment or hours worked in connection with a one-day out-of-town assignment. These distinctions, and the treatment of some of this time as non-compensable, are purely creatures of the federal regulations, and are inconsistent with state law. (O.L. 2002.02.21).

    46.3.1 Under state law, if an employer requires an employee to attend an out-of-town business meeting, training session, or any other event, the employer cannot disclaim an obligation to pay for the employee’s time in getting to and from the location of that event. Time spent driving, or as a passenger on an airplane, train, bus, taxi cab or car, or other mode of transport, in traveling to and from this out-of-town event, and time spent waiting to purchase a ticket, check baggage, or get on board, is, under such circumstances, time spent carrying out the employer’s directives, and thus, can only be characterized as time in which the employee is subject to the employer’s control. Such compelled travel time therefore constitutes compensable “hours worked.” On the other hand, time spent taking a break from travel in order to eat a meal, sleep, or engage in purely personal pursuits not connected with traveling or making necessary travel connections (such as, for example, spending an extra day in a city before the start or following the conclusion of a conference in order to sightsee), is not compensable. If the employee’s travel from his home to the airport is the same or substantially the same as the distance (and time) between his home and usual place of reporting for work, the travel time would not begin until the employee reached the airport. The employee must be paid for all hours spent between the time he arrives at the airport and the time he arrives at his hotel. No further “travel” hours are incurred after the employee reaches his hotel and is then free to choose the place where he will go. (O.L. 2002.02.21)
    "Reality is that which, when you stop believing in it, doesn't go away".
    Philip K. **** (1928-1982)


    • #3

      Thanks for your input.

      From what I can tell:
      46.2 does not apply as these employees are not required to go to the shop or another project prior to going to the project in question.
      46.3.1 does not apply as these are not office employees that typically go to one place for their work and are asked to travel out of their ordinary route or typical milage to work.
      If our empoyees take flights we do pay the entire trip less the time to the airport which is 15 minutes from the shop.* We pay for their parking, time spent from airport to hotel check-in and then give $40 a day for food.* Overtime included if warrented.

      46.3 confuses me. I was under the impression that field personal only gets paid for travel longer then their typical commute. We do not have the typical commute on paper. I believe federal law states that we are not required to pay them to the project. Their time starts once they start working the project.

      As mentioned in our first post, we want to compensate our employees as it is unfair to have them travel 175 miles, we simply want to do it correctly.


      • #4
        CA travel laws are more favorable to the employee then the federal laws are, so it does not necessarily matter what the federal rules say. The employee can/will claim that the more favorable state of CA rules have precident and the employee will be correct.

        Past that, what I listed is what CA-DLSE considers the rules to be. You might want to read the opinion letters issued on the subject. It is often useful to follow the logic CA-DLSE uses in the opinion letters.
        "Reality is that which, when you stop believing in it, doesn't go away".
        Philip K. **** (1928-1982)


        • #5

          Thanks again for your input.

          The first opion letter is not relevent to our situation.

          The second letter is relevent with regards to "Resonable distance" and workers that go to different jobs everyday or do not have a specific workplace. What is considered resonable distance? Remember, we are only talking of workers who do not have a designated work place but travel from job to job on seperate days.

          We understand if they go to more then one job site in the same day they are paid from the time they step foot on the first job to the time they leave their last job.

          We understand if we send a shop fabricator or office personal to training or a job site we are responsible for any "Time" beyond their usual commute.

          Concerning the resonable time, is there a number in the books or is this something we come up? Are we to negotiate with each induvidual employee?

          Please keep in mind that we are not trying to not pay our employees, we are simply trying to be fair to all parties and be legal. We would never send guys out of town without compensation, we just do not want to think we are doing right and then get sued 6 months from now do to our lack of knowledge on the subject.


          • #6
            At this point, you know what I know. Your obvious next step (absent other answers from other responders) would be to talk to CA-DLSE directly and maybe get an opinion letter specific to your circumstances. I can guess on this, you can guess on this, your employees can guess on this, but at the end of the day, the only opinion that matters is that of CA-DLSE.
            "Reality is that which, when you stop believing in it, doesn't go away".
            Philip K. **** (1928-1982)


            • #7
              sensa35: In getting (driving) to an out of town project, our employees take a company a truck or we pay their gas if they drive their own car.

              If you are paying "gas only," you are exposing yourself to a lawsuit that will be difficult (if not impossible) to win. The IRS mileage reimbursement rate (currently 58.5 cents per mile) is the presumptively correct rate at which employers must reimburse employees for the business use of their vehicles.

              sensa35: I understand if we send a shop fabricator or office person to training or a job site we are responsible for any "time" beyond their usual commute. Concerning the resonable time, is there a number in the books or is this something we come up?

              Many companies with whom I work base it on individual facts and circumstances. If an employees lives next door to the plant/office, ALL of his/her travel time (even if it is only 30 minutes) would be compensable, while an employee who normally commutes 1 hour to the plant/office would have to travel beyond that for anything to be compensable.

              My Suggestion: Read this proposed regulation and work with a labor law professional in your area to help sort all of this out for you.
              Barry S. Phillips, CPA

              IRS Circular 230 Disclosure: This response is intended to provide general information and written for educational purposes only. It does not establish a client relationship. This communication is not intended to be used, and cannot be used, for the purpose of (i) avoiding tax-related penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to any party any matters addressed herein.


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