When an employee on a businees trip is on and off the clock
Question: When an employee is sent on a business trip requiring travel and overnight stays, how are the hours of work calculated for pay and overtime purposes? What expenses is the employer legally required to cover?
Answer: An employer’s obligation to pay wages and expenses for business travel may arise from the employer’s own policies, or from the applicable employment contract or collective agreement. Otherwise, the nature and extent of this obligation will usually be governed by employment standards legislation.
Employment standards statutes across Canada prevent employers from requiring their employees to pay the employer’s business costs, and as a result reasonable travel expenses incurred by employees while they are on business trips will usually need to be reimbursed by the employer. It is permissible for an employer to establish reasonable policies governing expense claims, such as requiring the employee to produce original receipts and placing appropriate limits on meal, lodging and related expenses. The only province that explicitly deals with travel expenses is Québec, where employers are required to pay the reasonable expenses for transportation, lodging and meals of an employee who is required to travel. Reasonable expenses are interpreted as those expenses that are “usual and acceptable,” as opposed to those that are “exaggerated and extravagant.”
The question of when wages must be paid to an employee who is travelling on the employer’s business will typically depend on whether, and to what extent, the travel time is considered “work” for employment standards purposes.
In British Columbia, the time an employee spends commuting is not treated as time worked under the Employment Standards Act, even if the employer provides a vehicle for the employee’s use. However, if the employer requires the employee to run errands or provide other services while travelling to the worksite, that time is considered paid travel time and wages are payable. In addition, the time spent travelling at the request of the employer during the workday is considered to be work time.
The legislative schemes in Alberta and Québec are consistent with this approach. The Ontario statute is consistent with British Columbia, with the exception that an employee who is required to take home a company vehicle must be paid for the travel time to and from the workplace.
Another issue that arises in relation to travel is the point when an employer must start paying an employee who works at a remote job location. In this situation, the employer may designate a “marshalling point,” to which the employee must report in order to take employer-arranged transportation to the site. In British Columbia, travel to and from the marshalling point is considered commuting and is not compensable. However, the time spent travelling from the marshalling point to the jobsite and back is considered time worked.
Some provinces, including British Columbia and Alberta, allow employers to negotiate a different wage rate with their employees for travel time. However, this rate must be at least minimum wage.
An employer’s obligation to pay wages for overnight business travel will depend on the extent to which the employee’s travel time can be considered time worked.
In Ontario, an employee is considered to be working when she is travelling for business purposes that benefit the employer. An Ontario employee who is required to travel outside the employee’s normal working hours will usually be entitled to wages for the travel time up to the point when the employee arrives at the hotel. After that, the employee’s entitlement to further wage payments will depend on the circumstances. For example, periods during which if the employee is free to eat, sleep and attend to personal affairs will not count as work time. However, if the employee is required to attend a meeting or provide other services that benefit the employer, this would be considered work time and wages would be owed.
In British Columbia, the approach is similar. When an employee who does not normally travel as part of her job is required to travel, the employer may have to pay for the travel time. The duty to pay will arise where the travel is considered to be labour or service for the employer.
There are some provincial variations in the statutory provisions related to business travel, and employers should therefore check the applicable employment standards legislation in their jurisdiction.
