by Patrick M. Ngalamulume

Q    What is considered compensable time during the onboarding process under the Fair Labor Standards Act (FLSA)—for example, time completing paperwork before the start date as well as time reviewing policies and procedures and completing training?

A    Employee onboarding involves incorporating new employees into the organization by providing necessary knowledge and skills to succeed. As an employer welcomes new employees, it’s important to understand what constitutes compensable time during the onboarding process. Under the FLSA, compensable time means any period spent on work-related activities for which an employee must be compensated. In addition to actual work performed, work-related activities include activities that are considered by law to be essential to the functions of employment.

A standard workweek generally includes the time during which an employee is required to be on the employer’s premises on duty or at a precise work location. According to the FLSA, a “workday" refers to the period between the time when employees commence their "principal activity" and the time when they cease such principal activity.

During the onboarding process, different activities benefit both the employee and the employer. These activities include orientation sessions, training programs, completing necessary paperwork, and any other work-related tasks the employer mandates. While these activities may occur before employees begin their employment, they’re still deemed compensable time under the FLSA. Compensating employees for this time during the onboarding process guarantees employees are equipped to comply with company guidelines from the onset of their employment.

Countless employers provide onboarding training to new employees to enhance their skills and expertise to accomplish their responsibilities in the workplace. Onboarding training may include safety training, work-specific training, and compliance training. Likewise, completing paperwork, such as filling out tax forms, employment agreements, and health benefits enrollment forms, is also considered compensable time.

Although these tasks may seem administrative, they’re essential for verifying employment relationships and confirming legal compliance.

For further context, the following criteria outlined by the FLSA determines if time spent at meetings and training programs counts as work hours:

1. The event, meeting, or training is outside normal business hours.
2. It’s voluntary to attend.
3. It isn’t job-related.
4. No other work is being performed.

If all four points are satisfied, employers aren’t obligated to pay the employee for that time. In contrast, onboarding is normally mandatory, occurs during business hours, and includes filling out paperwork related to the job. Accordingly, employees must be paid for the time spent during the onboarding process.

It’s imperative for employers to precisely record and compensate employees for all compensable time during the onboarding process. Failure to do so can lead to violations of the FLSA and potential legal consequences.

Patrick M. Ngalamulume is an attorney in the Boise office of Parsons Behle & Latimer. Patrick is a member of the Intellectual Property Transactions and Litigation practice teams and focuses his practice on all aspects of business, including drafting, negotiating, and advising on contracts; licensing of technologies; corporate compliance; entity formation and governance; and commercial transactions. He can be reached at 208-562-4900 or pngalamulume@parsonsbehle.com.