(a) Failure to pay for nonproductive time worked. Some agreements
provide for payment only for the hours spent in productive work; the
work hours spent in waiting time, time spent in travel on the employer's
behalf or similar nonproductive time are not made compensable and in
some cases are neither counted nor compensated. Payment pursuant to such
an agreement will not comply with the Act; such nonproductive working
hours must be counted and paid for.
(b) Compensation payable for nonproductive hours worked. The parties
may agree to compensate nonproductive hours worked at a rate (at least
the minimum) which is lower than the rate applicable to productive work.
In such a case, the regular rate is the weighted average of the two
rates, as discussed in Sec. 778.115 and the employee whose maximum hours
standard is 40 hours is owed compensation at his regular rate for all of
the first 40 hours and at a rate not less than one and one-half times
this rate for all hours in excess of 40. (See Sec. 778.415 for the
alternative method of computing overtime pay on the applicable rate.) In
the absence of any agreement setting a different rate for nonproductive
hours, the employee would be owed compensation at the regular hourly
rate set for productive work for all hours up to 40 and at a rate at
least one and one-half times that rate for hours in excess of 40.
(c) Compensation attributable to both productive and nonproductive
hours. The situation described in paragraph (a) of this section is to be
distinguished from one in which such nonproductive hours are properly
counted as working time but no special hourly rate is assigned to such
hours because it is understood by the parties that the other
compensation received by the employee is intended to cover pay for such
hours. For example, while it is not proper for an employer to agree with
his pieceworkers that the hours spent in down-time (waiting for work)
will not be paid for or will be neither paid for nor counted, it is
permissible for the parties to agree that the pay the employees will
earn at piece rates is intended to compensate them for all hours worked,
the productive as well as the nonproductive hours. If this is the
agreement of the parties, the regular rate of the pieceworker will be
the rate determined by dividing the total piecework earnings by the
total hours worked (both productive and nonproductive) in the workweek.
Extra compensation (one-half the rate as so determined) would, of
course, be due for each hour worked in excess of the applicable maximum
hours standard.
