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August 07, 2009
How to Use Make-Up Time and Compensatory Time Off in California

Nonexempt employees sometimes need to attend to personal matters during the workday—but they don’t want to dip into valuable vacation time to do it and loss of even a few hours of work can strain an employee’s budget. What options are available to allow the employee to deal with quick personal matters without using up benefits or losing pay?

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California law provides two alternatives—makeup time and compensatory time off—that give hourly employees flexibility and don’t require them to give up pay or use paid time off benefits. However, as discussed below, employers should be aware that the compensatory time off option allowed under California law conflicts with current federal law.

Makeup Time

California Labor Code Section 513 and the Wage Orders of the Industrial Welfare Commission permit employees to use makeup time. Makeup time allows employees to take time off and work that time earlier or later in the same workweek even if the employee works more than 8 hours in a day to make the time up, without having to be paid overtime pay. However, if the employee works more than 11 hours in a day, or 40 hours in the week, overtime and/or double-time pay is still due.

The key to makeup time is to ensure that it is worked in the same workweek that the time off is taken. For example, assume an employee works a regular Monday through Friday schedule of 8 hours per day. The employee can take off 2 hours on Tuesday, and then work 10 hours on Wednesday to make up the time, without losing pay and without having to be paid daily overtime for the extra 2 hours worked on Wednesday. Likewise, an employee who knows ahead of time that he or she will need to take off 3 hours on, say, a Friday, can schedule in advance to work longer days earlier in the week so that there’s no loss of pay for the time taken on Friday.

If an employee works makeup time in advance and then later decides not to take time off, employers do not have to pay overtime for the additional hours worked earlier in the week. However, the employee should not be permitted to work more than 40 hours in that workweek as a result of working the advance makeup time, and should be required to take the requested time off. Otherwise, overtime pay will be due for any hours worked in excess of 40 in the workweek. Note that employees can work makeup time on a non-regularly-scheduled workday.

The other key requirement for a proper makeup time policy is that the employee must request to use makeup time in writing before taking the time off or working the makeup hours. Written makeup time requests can be made up to 4 weeks in advance, and a single written request can be made for makeup time that will occur in multiple weeks within that time frame. Employers must also keep records of all written makeup time requests as well as the hours taken off and made up for at least 3 years.

Sample Makeup Time Policy

[Company] understands that from time to time, short-term personal matters will arise that our nonexempt employees will need to attend to during the workday. To avoid any loss of pay [or the need to use your other paid time off benefits] when such situations arise, nonexempt employees can request to work makeup time to handle personal matters that require only a few hours off.

Requests to work makeup time must be made in writing and signed by the employee making the request before taking time off or working makeup time. All makeup time requests must be approved by your [manager/supervisor/ human resources] in advance. Makeup time requests can be made up to 30 days in advance of when the makeup time is to be worked.

You may work makeup time before or after taking time off, provided that the specific dates that the makeup time is to be worked are provided for in your written request, and that the makeup time is worked in the same workweek that the time off is taken. If you request time off, work makeup time, and then later find that the time off is not necessary, you will nonetheless be required to take the requested time off unless otherwise approved by [your manager/human resources].

You will not be entitled to daily overtime pay for hours worked in excess of 8 in a day if those hours are makeup time. Under no circumstances will you be allowed to work makeup time that would result in working more than 11 hours in a workday or 40 hours in a workweek.

Compensatory Time Off

Most employers and employees alike have heard the term “comp time,” which is short for compensatory time off. Comp time allows an employee to earn time off instead of being paid overtime wages. Some employees—especially those who generally only work a few overtime hours—prefer earning time off to receiving overtime pay because they find they get the most benefit from having a little extra paid time off to use for personal matters, rather than dipping into their vacation banks.

Under California law, both public and some private sector employees can earn comp time in place of overtime. However, under current federal law, comp time is only available to public employees. A bill now pending before the U.S. Congress, called the “Family Friendly Workplace Act,” would change the federal rule and permit comp time for public and private employers alike.

Until that happens, private sector employers in California that permit employees to earn comp time run the risk that they may be sued under federal law for the value of overtime wages that were paid out as comp time. It is therefore not recommended that an employer implement or permit a comp time plan to be used without first consulting a legal expert.

A legal or other qualified expert should also be consulted before implementing a comp time policy because a number of rules in the California Labor Code govern comp time.

Practice Tip

Makeup time should be an occasional exception to the employee’s normal schedule; employees should not be permitted to use makeup time to essentially set their own schedules.

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