Employers often times ask their employees to travel, either on a day trip or on multi-day trips, to work temporarily at a different location. What isn’t always clear is exactly what the employer must pay the employee for while on the trip. Does the employee get paid while traveling, while eating, or while sleeping? Must the employer reimburse the employee for travel expenses? The employer must be sure to follow any applicable laws to ensure that employees don’t bring forth an action against them for lost wages.
Michigan law says very little, if anything, on these topics. To answer the questions posed above, we look first to the Fair Labor Standards Act (FLSA). Section 785.37 of the Code of Federal Regulations (CFR) states that for one-day assignments, the employer must pay the employee for time spent traveling to another city. The employer may be able to deduct the time the employee usually takes to drive to work if the employee did not report to his usual workplace that day.
Section 785.39 details when an employer must pay an employee for time spent traveling for overnight stays. When an employee is required to travel away from home and it spans more than one workday, time spent traveling must be included in hours worked provided that time occurs during the employee’s normal work hours. This also applies to travel on non-workdays, Saturday or Sunday for example, if the travel was during normal work hours. Travel outside of normal working hours is not considered working time, and the FLSA does not require payment.
While some states (like California) have laws requiring employers to cover travel expenses for employees via reimbursement or a per diem, Michigan does not.[1] Because Michigan does not have any laws requiring employers to cover employees’ travel expenses, it is between the employer and employee to contract for these terms. It is customary for employers to cover these expenses, as not doing so can lead to higher turnover.
[1] California’s law applies to employees of other states that may be temporarily working in California. California’s law does not specifically require a per diem, a per diem can satisfy the requirement if it is equal to the IRS rate for the travel location.
