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Seminar and Travel Pay: It’s No Vacation by Paul Edwards

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The rules surrounding travel and seminar pay have confused many a dentist and practice manager—partly because they get a bit complicated, and partly because wishful thinking tends to intervene. On that note, this article brings you both good news and bad news.

Let's start with the positive: No matter what your area of confusion, there's a rule addressing that area.

What's the bad news? Unfortunately, no matter how awesome your practice is, it isn't the exception to the rule when it comes to federal law. You cannot create your own policies for when to compensate employees for seminar attendance, nor for what travel time can be compensated. If you don't follow the federal regulations to a T, you are risking fines or inviting employees to make claims against you for Wage and Hour Division violations. So, with that said…let's talk about the law.

There's a rule for that
We have the Fair Labor Standards Act (FLSA) to thank for the legislation surrounding seminar attendance compensation. The Department of Labor's Wage and Hour Division is responsible for enforcing the FLSA, and in some states (hello, California!), even stricter rules apply.

I'm only going to address the federal laws here, but you should familiarize yourself with your state's specific laws, as well.

Here's the scoop. According to the FLSA, all four of the criteria below must be true in order for the time your employee spends at a seminar, CE or training event to not be compensable time.

Got that? One strike and you're out! (And so is your checkbook.) Here are the criteria: 1. The seminar must happen outside of normal work hours.
I really do mean "work hours," not "work days." If your office is usually open from 9 a.m. to 4 p.m. daily, that means that most—if not all—hours your employees spend at a seminar are compensable, right off the bat. Even if it takes place on a weekend.

2. The seminar must be voluntary.
Did you initiate or offer the opportunity to attend this event? If your employees felt that you said or implied anything that led them to believe that you wanted them to attend for any job-related reason, the word "voluntary" will not negate your obligation to pay.

3. The employee must perform no productive work during the seminar.
No matter how exotic the destination where the conference is held, nor how lucky your employees are to go, if they're working, you'll have to pay.

4. The seminar is not job-related.
Will your employees learn information, techniques, or skills they can use later, on the job? Then you'll have to pay. If the event will educate or train the employee in any way, then the hours are compensable.

As you probably noticed, rule 4 is the clincher. Unless your team is going on a whitewater rafting getaway, where the only education they'll receive is how to build a fire and pitch a tent, federal law mandates that you compensate your employee(s) for time spent training or at a seminar. The time is subject to overtime, too, if your employee goes over 40 hours per week.

An easy way to think of it is the "butt in the chair" rule. For any hours your employees are sitting (or standing, in some cases) in a meeting, CE or class that you required or instigated, you have to pay them for their time. However, this does not include time spent eating, relaxing, talking, shopping, or sleeping. Only time spent in training.

But wait! There is one small exception that might apply: continuing education to maintain licensure.

If your employee is attending a seminar or participating in continuing-education training to maintain his or her state licensure (e.g., hygienists), without which he or she would not be able to continue to work, then you do not have to pay for that time.

But be careful. If you require the employee to attend a specific CE event at a specific time (e.g., Friday at 3 p.m. rather than Monday, because of office scheduling conflicts), then you're right back on the hook for paying.

What about travel time?
The law has something to say about travel time, as well. First, there's the car-versus-plane rule. Travel time when an employee drives to the event herself is always compensable, even if outside of normal working hours. You may deduct her normal commute—from home to the office—off each leg of the trip, but the rest of the time is compensable (as are the fuel costs).

For planes, trains, buses or mass-transit rocket ships, the rules have to do with what we talked about earlier regarding an employee's normal work hours. If travel time to or from a training event cuts across normal work hours, and the employee is a passenger, then those hours are compensable. They're also subject to overtime.

Here's an example. Your dental hygienist Harold normally works from 8 a.m. to 5 p.m., and today you're sending him to an out-of-town training event. His plane is scheduled to leave at 3 p.m. and arrive at 6 p.m. Since this cuts across his normal schedule for two hours, he is entitled to two hours of travel pay. This is true even if Harold travels on a Saturday or Sunday, days when your practice is normally closed.

And of course, if you have an employee who actually performs work while traveling (answering emails or typing reports, for instance), that time is also compensable as time worked. This is true whether or not the work is performed during normal work hours or days.

When traveling between time zones, the time zone from the point of departure (each way) is used.

Now for some good news: you can use travel time to your advantage a bit if you're careful. Assuming your employees are not driving themselves to a required event, you could put them on a flight that falls outside your normal work hours, say, 6 p.m. to 8 p.m., and thereby not pay for the time your employee may spend watching terrible in-flight movies.

Differential rates of pay
While employee training and travel time must be compensated in accordance with the criteria above, you do have the option of setting a different, lower rate of pay for that time, so long as it is at least the minimum wage required in your state (and/or city). This is called a differential rate of pay, or non-production pay.

Note: If you do choose to pay training and/or travel time at a differential rate, this policy and the differential rate must be presented to and acknowledged by your employees prior to the event. Even better, have it as a permanent part of your employee handbook.

Do overtime rules apply?
Absolutely. All hours your employees spend at a seminar are also subject to the usual 40-hours-per-week rule for overtime pay. (Plus any special rules your state may have dreamed up.) So if your office manager, Marissa, works 38 hours in-office and then attends a seminar for six hours, you'll pay four hours of overtime at 1.5 times her regular rate of pay.

If you've used a differential rate for compensable travel and/or seminar time, so that Marissa earned a lower rate for those last six hours, you would use a weighted average to calculate her appropriate overtime rate for that week.

Pretty much everyone is getting this wrong
Given how complex seminar and travel pay rules can be, you may be realizing right about now that every dental practice you know is getting something wrong.

From seasoned dentists and administrators with 30 years of experience, to otherwise great practice-management coaches or even attorneys, I've heard an unbelievable amount of bad advice on this topic. Even worse, of the hundreds of employee handbooks I've reviewed over the last eight years, 90 percent of them have downright illegal policies regarding seminar and travel compensation. Think of it as handing over a smoking gun to the authorities and saying, "Look, I've been breaking the law!"

That's why I always recommend that dentists have their handbooks periodically reviewed and corrected by an expert in HR and employment law. If you'd like your policies checked for outdated, unenforceable, or illegal verbiage, Dentaltown readers can request a complimentary handbook audit at Cedrsolutions.com/DTEV.

Regardless of how annoying or complex these rules are, they are very clear, and no bad policy negates them. Your employees may not sign their compensation rights away, either—even if it means getting to go with you to Hawaii.

Paul Edwards is the CEO of CEDR HR Solutions (Cedrsolutions.com), which provides custom employee handbooks and unlimited HR support to dental offices of all sizes across the United States. He has more than 25 years of experience as a manager and owner, and specializes in helping dentists successfully navigate employee issues. He can be reached at pauledwards@cedrsolutions.com or (866) 414-6056.


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