I have noted recently that there are a wide variety of policies on how employers are compensating their employees for travel time. Some companies pay only one way, or set limits on the number of kilometres or hours they will compensate for. Unfortunately neither of these practices is correct.
In order to pay the employees correctly, we must first distinguish between “Commute” and “Travel” time as these are separate entities under Employment Standards.
“Commute” refers to the time spent traveling from the employee’s home or place of rest (such as a hotel if on the road) to the place of work and then again from the place of work to the home/place of rest.
“Travel” refers to the time spent traveling for the benefit of the employer, such as sales routes and trips between construction job sites or from a main office to satellite offices or jobsites.
For example, if your employees are required to arrive at a central location on their own, then get into a company vehicle and travel to another site, any time spent in that vehicle is considered work time, including the return trip to the original office.
The part that gets confusing is that there could be overtime payouts if the number of hours “worked”, including travel, exceeds 44 hours in the week. Employers are required to recognize “travel” hours when calculating the number of hours worked for overtime.
The employer can, however, pay the employee a lesser rate of pay for “travel” than the employee would receive for actual work on the job, as long as the travel rate is at least minimum wage.
Paying a lower travel rate could help lessen the impact of the travel costs when dealing with heavily-travelled routes that are frequently tied up with accidents and traffic jams.
The employer may still have to pay overtime based upon the number of hours worked but the amount of pay is lessened by the lower travel rate.
The overtime rate can be applied to the normal wage, or the “travel” wage, or a hybrid of both wages, so long as the employee receives 1.5 times the rate of pay for the number of hours over 44 in the work week.
