Overtime Pay or Comp Time—Employer’s Choice?

On May 2, 2017, the House voted to pass a bill (HR 1180) that would allow employees to exchange overtime pay for “comp time” similar to what the government has been doing for decades.  This bill would extend this option to private-sector employees, making it legal for them to choose between an hour and a half of paid comp time and time-and-a-half pay when they work additional hours.  This is not the first time a bill like this has passed the House, but fails to get out of the Senate.  The White House said Tuesday that it supports the bill, saying in a statement that it would “help American workers balance the competing demands of family and work by giving them flexibility to earn paid time off.”

Under the proposed changes, eligible employees — if their employer decides to offer the option — would be able to voluntarily choose to receive comp time they can bank and use at a future date in lieu of immediate overtime pay in their paychecks. If they change their minds and want the pay after all, employees would have the option of “cashing out,” with the employer required to pay the overtime within 30 days.  The measure, among other rules, would give employers the final say on when comp time can be used.

See Law 360: 4 Things Employers Should Know About ‘Comp Time’ Bill

~Author: Chandra Davis, ELS Partner