When Must I Pay Employees for Travel Time?

Travel Time vs. Commuting Time

Paying Employees for Travel Time
Paying Employees for Travel Time. Hinterhaus Productions/Getty Images

What is Employee Travel? 

In this article we'll look at pay for the time employees spend traveling, and how this travel expense affects employee pay and taxes, and whether that time is paid. 

In general, travel during regular work hours or time spent by an employee in traveling as part of his or her "principal activity" must be paid. Travel which is "incidental" and time spent commuting (traveling between home and work) is not paid.

Also, the IRS specifically describes travel time as time traveling away from home and if

  • The duties of the employee require being away from the employee's tax home "substantially longer than an ordinary day's work, and

  • The employee needs to sleep or rest to meet the demands of work while away from home.  

Travel Time vs. Commuting Time 

Commuting is going back and forth to work. Everyone has to do this, so the time spent commuting isn't part of the employee's job duties. But if the employee is making a trip by car that is authorized by your company, that travel time should be paid. 

Everyone (at least everyone who doesn't work at home) commutes to a job. Commuting time is personal time, not business time, and employees should not be paid for commuting time.

The Department of Labor (DOL) discusses employees who drive employer-provided vehicles: 

Time spent in home-to-work travel by an employee in an employer-provided vehicle, or in activities performed by an employee that are incidental to the use of the vehicle for commuting, generally is not "hours worked" and, therefore, does not have to be paid.

Here's a possible rule of thumb: If you authorize a trip made by car (whether it's the employee's car or in a company-provided car), the travel time should be paid. 

Travel Pay for Hourly Employees 

Pay to employees for travel time is only applicable to non-exempt (hourly) employees, not to exempt (professional or managerial) employees.

Exempt employees are paid for their expertise by the job, not by the hour.

Travel Examples - Paid or Not Paid?

  • An employee drives to work from his home every day. You ask him to stop one day and pick up bagels for the staff meeting. This driving time is not paid. Time commuting to work is never paid time; the time to stop for the bagels is "incidental" to the commuting, and is not part of the employee's job.
  • You ask an employee to get bagels for the office meeting. If the employee makes this trip during normal work hours, he or she should be paid. It's not clear if the employee should be paid for this time outside of work hours, but it makes sense to me that if you ask an employee to do something for you after work hours, this too should be paid.  
  • An LPN (licensed professional nurse) works for a nursing facility and travels between the two locations of this facility as directed, providing care for patients at both locations. Her daily travel time must be included in her pay.

Paying Employees for Time Spent Traveling

Employees who travel to another location for business purposes are a different case. In general, you must pay employees for time spent that is under your control and time which they cannot spend as they wish.

So if an employee travels from Cleveland to Pittsburgh for a two-day seminar at the direction of the company, some part of the employee's time should be compensated.

In the case of salaried employees, paying for travel time is not an issue, because salaried employees are paid for the job, not for hours worked. Paying for business travel time may be an issue, though, in the case of an hourly employee.

Paying for travel time for one-day or overnight stays is complicated. Contact the nearest district office of the U.S. Department of Labor for information on specific instances of travel time that affect your business. You may also want to contact an employment attorney to discuss these issues.

State Regulations on Paying for Employee Travel

Check with your state labor department to see if there are any rules which might supersede the federal rules.

For More Information

Susan Heathfield at The Balance has some tips for reducing the cost of employee travel. 

SHRM (the Society for Human Resource Management) has more information about paying employee travel time. 

Read more about mixing business and personal travel. 

For more details from the IRS on employee travel time, see IRS Publication 535: Business Expenses