Are Employers Required to Pay Employees for Training Courses?

August 31, 2017

Employees often spend hours of their employment in meetings, training courses and lectures. A potentially unclear area for employers is whether and under which conditions employers are required to pay an employee for training time. Employers are often unsure if training time is considered hours worked or if this time should be unpaid.

According to the Fair Labor Standards Act (“FLSA”), when employees spend time in training courses, the time is considered hours work and payment is required, unless all of the following is met:

• The employee voluntarily attends the training courses;
• The training course is not job-related;
• The employee does not perform any productive work during the training course; and
• The training course is given outside regular business hours.

Consider the following. An employee is required to take a training course by his/her employer. The purpose of the training course is to help the employee be more effective in his/her job duties, so it is directly related to the job, the employee is performing productive work during this time and the training course is taught during work hours.

For example, an accountant who participates in a finance course is engaged in an activity to enhance his/her skills in finances, which is directly related to accounting. Therefore, the time he/she spends in such training course provided by his/her employer is considered “hours worked” and that employee must be paid.

Conversely, if the accountant takes a course in drafting employment contracts, he/she is not participating in a course that is likely to enhance his/her accounting skills and the employer would not be required to pay this employee.

Further, if the purpose of the training course is to prepare an employee for advancement by upgrading the employee to a higher level within the organization, the training is considered “not directly related to the employee’s job,” despite the fact that it incidentally improves his skill in performing his regular job functions.

Often, small employers will provide orientation training to new employees and mistakenly not pay them if they fail to pick up the skills they are being trained. This is not acceptable according to many state Departments of Labor who take the informal position that training at the outset of employment must be paid.

We suggest that employers consider the foregoing when determining whether the pay an employee for training courses. If all four conditions are satisfied, the employer is required to pay its employees for the hours spent in training courses.

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