Q: Should employers pay for employees’ driving time or reimburse them at the IRS mileage rate?
A: Although private employers in most states are not required by law to reimburse employees for mileage pertaining to work-related private vehicle use, many find it beneficial to do so. Businesses enjoy a significant tax break for mileage and vehicle maintenance reimbursement, and many companies find that offering this perk helps them attract and retain talented employees. However, if non-exempt employees are driving as a part of their work duties, it is imperative to ensure that they are being compensated during the time that they are traveling from one work location to another, as they are engaged in job-related duties. Whatever policies your organization adopts in this regard, it is important to ensure that you are consistent in your practices so that any employee who travels as a part of his or her work duties is compensated fairly as well as in line with the Fair Labor Standards Act (FLSA) and applicable state law.
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