How to Set up a Flextime Policy

Many employees prefer to work a nonstandard schedule, commonly called a flextime arrangement. Flextime may involve working non-traditional hours, or working more hours on some days and less on others. Flextime can also benefit employers by increasing employee satisfaction, helping to attract new employees, and enabling a longer day of coverage in the business without increasing the number of employees or the hours they work.

Employers who are open to these arrangements should adopt a formal flextime policy to govern the arrangements. Employers need to consider how many employees may be interested, whether flextime will cause disruption to the business, how they will track employees’ hours, and which employees and positions will be eligible to participate.

There is no one-size-fits-all flextime policy. Every business has its own unique set of circumstances to consider prior to creating a flextime policy that suits its organization. However, all businesses should consider certain common issues prior to creating a flextime policy.

The Fair Labor Standards Act and the New Jersey Wage and Hour Law require payment of overtime to nonexempt employees for any hours worked over 40 in one work week. Permitting employees to work non-standard hours may complicate this process. A business may need to consider alternate time-keeping methods if, for example, current practice involves signing in and out with a supervisor, and under the flextime arrangement a non-exempt employee might arrive in the office first. Although permitting an employee to work four 10-hour days a week instead of five 8-hour days will not give rise to any increased overtime pay, other flexible arrangements might. If an employee is allowed to flex their hours over more than one week, for example working 10-hour days Monday through Friday of one week, and not working at all the Friday of the next week, that employee will not have worked any additional time over two weeks, but would be entitled to 10 hours of overtime pay during the first week. An employer can solve that problem by changing the definition of the work week, but should do so carefully to avoid unintentionally increasing overtime costs. Employers may also decide to avoid these issues altogether by limiting flextime arrangements to exempt employees.

Employers may want to limit flextime arrangements to employees who have worked at the company for a certain amount of time. Flextime policies should be in writing and they must clearly define who is eligible to participate and how flextime should be requested. Employers should also consider preserving flexibility for themselves by providing for on-going review of any flextime arrangements.

Employers should also be aware that, regardless of the provisions or existence of a flextime policy, flexible working hours may be a reasonable accommodation for an employee with a disability.

About the Author: Scott A. Ohnegian is chair of Riker Danzig Scherer Hyland & Perretti LLP’s labor and employment group. He focuses on the representation of management in litigating federal and state employment matters.


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