I allow my hourly employees to take two 15-minute breaks during their shift as well as a 30-minute midday break. I require them to punch out and punch back in on a time clock for each of these breaks. Can I deduct the time they punch out from their paychecks?

November 10, 2016

Topics: Pay Practices

Federal wage and hour laws do not require that employers provide employees any specific number of meal, lunch, or rest periods in factories or offices (although some state laws do).  These federal laws do require, however, that if an employer does not want to pay for an employee’s break period, it should give the employee a “bona fide” break of at least 30 minutes.

A “bona fide” break means that the employee is completely relieved of work during the period, is free to leave his or her work station (but not necessarily the premises), and is not required to perform any tasks during the break time.  For example, a secretary who is required to eat at his or her desk is not relieved of duty if the employee is required to answer the telephone or respond to customers during the meal period.  A hotel clerk who cannot leave the front desk during his or her meal period and can be interrupted by a guest checking in or a phone call also is not completely relieved of duties.

In contrast, breaks shorter than 20 minutes, such as coffee, snack, smoke, or restroom breaks, or personal telephone calls or visits, usually have to be compensated by the employer under federal law and count as hours worked.

The law is somewhat unclear as to whether employee breaks lasting from 20 to 30 minutes must be paid.  For example, is a 25 minute break compensated working time or an unpaid “bona fide" break? This is not a well-developed area of the law, but one about which employers should take note.  Although it is unusual to schedule a 25 minute meal break, such might occur.  To help avoid having this time be counted as compensable working time, it is prudent to completely relieve all duties during this time and allow the employee to do as the employee pleases, including even napping if the employee wants to do so.  Under that scenario, the break period is more likely to
be designated as more like a “bona fide” break that need not be compensated rather than a short break that must be compensated.

It is important that the employer ensures that break periods are properly designated and recorded so as not to be liable for overtime hours if break periods are not properly paid and later designated by a court or government agency as compensable time. Unpaid wages for improperly designated break time also may be recoverable in a civil action, with potential interest and penalties to be assessed in addition to the past-due wages liability.

Based on the question above, a full 30-minute break probably could be deducted as non-working time from the hours the company must pay the employee, while the 15-minute breaks should not. The employer also should ensure that the employee is completely relieved of duties during that 30-minute period. The prudent employer also should consult with counsel and discuss making the company’s policy regarding paid breaks part of its handbook policy to support the break deduction if later challenged.

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