The U.S. Department of Labor has suspended the “continuous workday” rule for employees, who are working from home because of the COVID-19 outbreak. This considerably changes how small businesses may compensate non-exempt employees working from home due to the pandemic.

The U.S. Department of Labor issued a “temporary rule” providing guidance on COVID-19-related issues under authority of the FFCRA, the Families First Coronavirus Response Act. As part of the new guidance (will remain in effect until the end of the year), the DOL declared its “continuous workday rule” to be “inconsistent with the objectives of the FFCRA and CARES Act” for employees who are working from home during the crisis. The new guidance that was issued under the FFCRA, applies to employers with fewer than 500 employees.

Under the DOL’s earlier continuous workday guidance, all the time between the first and last principal activity of the day is generally considered compensable work time. The continuous workday rule has been used in the past to argue that otherwise non-compensable time, that occurs after the beginning of the employee’s first principal activity, and before the end of the employee’s last principal activity, such as commuting time, is covered under the FLSA.

With the new temporary rule, it was determined that during COVID-19 pandemic, applying the continuous workday rule for teleworking employees would “undermine the very flexibility in teleworking arrangements that are critical to the FFCRA framework Congress created within the broader national response to COVID-19.”

This means that employers who, as a result of COVID-19, allow non-exempt employees to WFH and break their day into chunks of working time, with personal business in between, need not necessarily treat the entire day as compensable under the FLSA. As an example, the DOL describes an employee who, because of COVID-19, is scheduled to work from home 7-9 a.m., 12:30-3 p.m., and 7-9 p.m. That employee would need to be paid for the 7.5 hours actually worked, not the 14 hours between 7 a.m. and 9 p.m.

Beyond the DOL’s example, the temporary suspension of the continuous workday rule also has implications for unscheduled WFH. For example, if that same employee is interrupted at 8:30 p.m. to care for a child, and then returns to finish work from 9 to 9:30 p.m. (while technically off-shift), the employee should still be paid for 7.5 hours, not 8 hours.

One cautionary note: while courts confronted with a continuous workday claim in these sorts of situations should defer to this new DOL guidance, particularly given the exigent circumstances, it is not a certainty that they will. Nevertheless, the new guidance is persuasive and makes good practical sense in the shadow of COVID-19.

Further, although the DOL’s new guidance allows greater flexibility for small businesses in managing WFH arrangements, it also underscores the importance of accurate timekeeping. Employees should continue to stick to a schedule to the extent possible, aided by the option to flexibly schedule as described above. And as before, employees should be expected to accurately record the times they start and stop work. Managers must remain vigilant as greater flexibility may make it easier for employees to work more than intended and at odd hours, or to become lax with timekeeping.

Finally, employers should remain cognizant of state laws regulating compensable time, including state laws with their own continuous workday rule as well as state laws mandating certain meal and rest breaks. The new DOL guidance pertains to the FLSA only and does not override more restrictive state law requirements.

We will continue to monitor and report on significant developments in this period of uncertainty and change. If you have any questions in the meantime, we are here to help.

To learn more, consult one of the leading wrongful termination and sexual harassment attorneys in Phoenix, AZ at Chahbazi Law PLLC or call 602-282-5868 Now!Attorney Meenoo Chahbazi uses her extensive experience and passion for employment equality to represent Arizona employees in a wide range of employment matters.