House-Approved Bill Allows Time-Off Flexibility in Lieu of Overtime

Time off or overtime pay? Many employees who work extra hours have had that option for years. On Tuesday, the U.S. House passed a bill that would allow more employers to offer compensatory time off instead of overtime wages if the employee agrees. It’s unclear if the bill will make it through the Senate since many Democrats argue it could weaken worker protections.

Houston labor and employment lawyer Marlene Williams of Jackson Walker LLP says: “This bill simply amends the Fair Labor Standards Act so that private employers are allowed the same flexibility that public employers have had since 1985.

Many companies, especially those in the energy sector with boom and bust cycles, would find this appealing to help manage labor costs. And the bill protects workers because the receipt of comp time in place of cash wages must be a voluntary choice. Given the increasing demands on family schedules, many employees these days prefer time off when offered as an alternative to cash wages for overtime hours. This proposal comes as we are waiting to see the outcome of a court challenge to an Obama administration rule that would expand overtime eligibility to higher-paid workers. Many companies have already adopted that rule, giving workers raises so that their salaries allow them to be exempt from overtime. It seems unlikely that larger employers would take back those salary increases now, no matter what the court rules.


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