Compensatory time, commonly referred to as comp time, is the paid time off that is given to non-exempt employees instead of overtime pay. A company which has a comp policy allows its employees paid time off work at the same rate that they would have paid them if they were to pay for overtime. In the U.S., employees are expected to work 40 hours each week. Any additional time worked must be paid either as overtime pay or compensatory time.
Compensatory Time Vs. Overtime Pay
For organizations that have flexible work schedule programs, compensatory time may be offered to employees in lieu of overtime pay. This would apply when workers exceed the 40 hours per week limit. The paid time off can be given to salaried employees who are asked to work extra hours under flexible schedules.
Employers must make sure that they compensate their employees for paid time off. And it should be at the same rate that they would have paid those employees for overtime. An employer may be held in violation of the Fair Labor Standards Act (FLSA) if it fails to use identical rates for compensatory time and overtime pay.
Who Qualifies for Compensatory Time?
The answer to this question depends on whether the employee is exempt or nonexempt. Since exempt employees do not qualify for overtime pay under the FLSA they are often given compensatory time to reward them for the extra time that they put in. On the other hand, nonexempt employees are commonly covered by the employment regulations of the FLSA, which demand that they must be paid overtime pay for extra hours worked. Therefore, this group of employees are ineligible for compensatory pay. These employees cannot qualify for comp time because of the requirements of the FLSA. This law expressly demands that they must be paid for every additional hour that they have worked in excess of the normal 40 hours per week.
Employers must acquaint themselves with the rules and regulations that govern compensatory time and overtime pay in their states. Failure to compensate nonexempt employees in accordance with the law can land an organization in serious legal problems.
Is Compensatory Time Offered to Employees in Both the Public and Private sectors?
Formally recorded and structured compensatory time occurs frequently in the public sector where employees are represented by unions. Most private sector employers do not offer compensatory time to their salaried exempt employees. This is due to the fact that they don’t want these employees to take on an hourly work mentality. These employers prefer their employees to embrace mindsets that promote job accomplishment and goal achievement. And doing what it takes to complete a job in good time and with acceptable quality.
This leads us back to the question:
Do Salaried Employees Get Compensatory Time?
The answer is yes and no. It is “yes” if the employees are classified under those who are nonexempt and work for the public sector. Therefore, you must you must be nonexempt and also work for the public sector to received comp time for the accrued time worked past the 40 hours per week threshold.