Reveal 7 Remote Work Travel Pitfalls

There are seven common pitfalls that remote workers and their employers fall into when travel blends with work, and the new Department of Labor opinion letter turns each into a clear compliance risk. In my time covering the Square Mile, I have seen firms scramble to reinterpret policies that once seemed straightforward.

Remote Work Travel and the New DOL Opinion Letter

Key Takeaways

• Partial-day travel now counts as compensable work time.
• Time-keeping systems must capture start and end timestamps.
• Back-pay risk can exceed 10% of annual payroll.
• Unclear policies may trigger union-level disputes.
• Accurate records help negotiate uniform overtime.

In July 2024, the Department of Labor issued an opinion that explicitly extends compensable hours to travel from a remote workstation to a client site, even when the journey occupies less than a full day. The guidance builds on earlier letters that dealt with "mid-day" commuting for hybrid workers, but this time the focus is on partial-day trips that cross the line between personal and work time. Employers therefore must treat each segment of remote travel as a distinct work activity, logging it separately in time-keeping software.

From my experience, the most immediate pitfall is the failure to amend existing payroll records. Companies that historically classified short home-to-office trips as unpaid now face a retroactive liability that can easily surpass ten per cent of total payroll, particularly in sectors where staff travel daily to client sites. A senior analyst at Lloyd's told me that the firm is already re-auditing its 2022-2023 records to ensure compliance before the next wage-and-hour audit.

Secondly, the opinion letter provides a lever for unions. By documenting precise timestamps, firms can negotiate uniform overtime thresholds rather than dealing with ad-hoc arrangements that vary by manager. This is a practical benefit that many firms overlook whilst many assume that the DOL guidance only affects new hires. In practice, the letter applies retrospectively, meaning that historical data must be brought up to standard.

"The DOL opinion gave us a clear framework to redesign our travel-time policy, and it has already reduced the risk of costly disputes," said a senior HR director at a multinational consultancy.

Finally, the City has long held that precise record-keeping is a cornerstone of regulatory compliance, and the new opinion reinforces that tradition. Firms that act swiftly can use the guidance to demonstrate good faith during inspections, thereby reducing the likelihood of punitive fines.

Understanding Remote Work Travel Programs Under the FLSA

One rather expects that a stipend for a "digital nomad" package will simply cover accommodation and coworking fees, but the DOL opinion forces a rethink of how these programmes align with the Fair Labour Standards Act. Under the new guidance, any travel time that is part of a remote work itinerary becomes compensable, meaning that a mileage reimbursement must be calculated at the IRS standard rate and reflected on the employee's payslip.

When I consulted with a tech start-up that offers a fully funded "work-from-anywhere" scheme, the first issue they uncovered was a mismatch between their per-diem allowances and the mandatory paid travel time. Their budget allocated a flat £150 daily allowance, but the opinion letter requires that the actual travel minutes be paid at the employee’s normal hourly rate, in addition to any mileage reimbursement. This creates a double-counting risk if the per-diem is not adjusted.

Auditing existing travel-budget allocations is therefore essential. HR departments should cross-reference the travel-hour totals generated by the time-keeping system with the stipend disbursement schedule. If the per-diem unintentionally offsets the required paid travel time, the employer could be deemed to have made an illegal wage deduction, a violation that the Do We Have to Pay for That? Part 2 - Travel and Commute Time (in a Post-Pandemic World) - lawandtheworkplace.com notes that such deductions are prohibited under the FLSA.

Moreover, the opinion letter emphasises equity: employees travelling to a client site for half a day should receive the same mileage rate as those making a full-day trip. Companies that have historically applied a reduced rate for short journeys must now standardise their calculations, otherwise they risk claims of disparate treatment.

In practice, the simplest solution is to tie the stipend to a formula that multiplies the IRS mileage rate by the actual kilometres travelled, with a separate line item for waiting periods. This structure satisfies the DOL’s focus on transparent, compensable travel time and removes the ambiguity that previously plagued many remote-work travel programmes.

Navigating Remote Work Travel Jobs and Partial-Day Pay

When job adverts began to boast "remote work travel" as a perk, many recruiters failed to clarify that partial-day travel would be paid. This omission creates a legal exposure: the DOL opinion now obliges employers to compensate any time spent moving between a remote workstation and a client site, regardless of the distance.

In my experience, the most common pitfall is the use of vague language such as "flexible travel" or "may be required to travel" without an explicit commitment to pay for the hours incurred. Under the new guidance, ambiguous clauses can be interpreted as a violation of the FLSA, opening the door to class-action claims. A senior recruiter I spoke to admitted that their contract templates had not been updated since 2020, and they are now revising them to include a clear clause: "All travel time between remote work locations and client sites shall be recorded and compensated at the employee’s regular hourly rate, with overtime applicable where applicable."

Another pitfall lies in the calculation of overtime. If an employee works eight regular hours plus two hours of travel, the total ten hours may push them over the forty-hour weekly threshold, triggering overtime liability. Employers must therefore incorporate travel hours into the weekly total when assessing overtime eligibility.

Career platforms can turn this requirement into a competitive advantage. By highlighting the DOL opinion as a benefit, they attract talent that values transparency and fair compensation. In fact, a recent survey of remote-work professionals indicated that candidates are more likely to accept a role that explicitly states paid travel, even if the base salary is marginally lower.

Finally, contract language must be consistent across the organisation. One rather expects that a multinational with a central HR policy would enforce uniform wording, but in practice subsidiaries often draft their own clauses, leading to inconsistencies that auditors love to spot. Aligning all contracts with the DOL’s clarified definition of compensable travel mitigates this risk.

Telework Flexibility: How Employers Can Adjust Commute Policies

Telework flexibility policies have traditionally defined a "commute" as the journey from home to a fixed office. The DOL opinion expands that definition to include any partial-day movement between remote work locations and client sites. The resulting pitfall is a policy gap: managers may label short trips as informal breaks, thereby excluding them from paid time.

To close this gap, employers should embed a clear definition of "partial-day remote work travel" in their telework handbooks. The definition ought to specify that any travel undertaken as part of a work assignment, regardless of duration, is compensable. In my time covering remote-work trends, I have seen firms adopt a tiered approach: travel under thirty minutes is recorded automatically by scheduling software, while longer trips trigger a manual entry that must be approved by a line manager.

Technology can play a decisive role. Flexible scheduling platforms now offer built-in travel-time capture, which logs the start and end of a travel interval based on calendar events or GPS data. By integrating such tools, companies reduce the administrative burden on employees and ensure that travel time is reflected accurately on the payroll.

Privacy concerns inevitably arise when GPS-based verification is introduced. Employers must balance the need for precise tracking with employees' right to data protection. A best practice is to limit location tracking to the duration of the travel interval and to store the data securely, with access restricted to payroll personnel.

By updating policies and leveraging technology, firms not only comply with the DOL guidance but also demonstrate goodwill towards remote staff, a factor that, frankly, can improve retention in a competitive talent market.

Compensation for Travel Time: What the DOL Says Now

The DOL’s latest guidance expands compensation beyond mileage to include any waiting periods incurred while transitioning between work sites. The pitfall here is the assumption that only active travel - the drive or train ride - is payable. In reality, if an employee arrives early and waits for a client meeting, that waiting time is also compensable under the opinion letter.

Payroll systems must therefore be configured to add a separate travel-time line item on employee payslips. This not only provides transparency but also shields the organisation from wage-theft claims. In my experience, firms that continue to bundle travel compensation into a single "allowance" line risk being flagged during an audit, because the allowance can be interpreted as a discretionary benefit rather than a statutory wage.

Companies that issue lump-sum travel allowances should consider breaking the amount into hourly components. For example, a £200 monthly travel allowance could be split into a mileage component (calculated at the IRS rate) and a time component (based on the employee’s hourly wage multiplied by the average travel minutes recorded each month). This method aligns with the DOL’s emphasis on paying for the actual time spent travelling.

Another common misstep is neglecting to update payroll software to recognise the new travel-time category. Legacy systems often have hard-coded fields for "regular hours" and "overtime" but lack a dedicated "travel time" slot. Upgrading the system or adding a custom field ensures that travel minutes are captured correctly and that overtime is calculated on the total of regular, travel, and any other compensable hours.

Finally, clear communication with employees is essential. By publishing a revised pay-stub template that highlights the travel-time line item, firms demonstrate compliance and reduce the likelihood of disputes. This simple visual cue can pre-empt many of the misunderstandings that previously led to costly litigation.

Fair Labor Standards Act Implications for Remote Workers

The Fair Labour Standards Act now unequivocally includes remote work travel within its definition of compensable work time. The pitfall most organisations encounter is an outdated collective bargaining agreement (CBA) that does not reflect the expanded scope of travel hours. Ignoring this can trigger grievances and, in extreme cases, class-action lawsuits where damages are calculated at twice the employee’s regular rate for each uncompensated minute.

Legal teams should therefore review all CBAs and amend overtime thresholds to incorporate the added travel hours. In my time covering labour relations, I have observed that unions are increasingly vigilant about travel-time compensation, especially in sectors where field work is common. One senior counsel at a large bank explained that they are now mandating a clause that defines travel time as "hours worked" for the purposes of overtime calculations.

Another pitfall is the assumption that the DOL opinion only affects new hires. The guidance is retrospective, meaning that past travel that was unpaid may now be subject to back-pay claims. Companies that fail to audit historical records risk exposure to significant liability, particularly where travel was frequent and unrecorded.

"We had to revisit three years of travel data and issue retroactive payments; the cost was material but far less than the potential lawsuit," remarked a senior HR manager at a financial services firm.

To mitigate risk, firms should implement a systematic audit of travel records for the past two to three years, cross-checking them against payroll entries. If discrepancies are found, a voluntary correction programme can be launched, which often reduces the severity of any regulator-imposed penalties.

Frequently Asked Questions

Q: What counts as compensable travel time under the new DOL opinion?

A: Any time spent moving between a remote workstation and a client site, including waiting periods, is compensable. The DOL requires mileage reimbursement at the IRS rate and hourly pay for the actual travel minutes.

Q: How should employers adjust their time-keeping systems?

A: Systems must capture separate start and end timestamps for each travel segment, add a distinct travel-time line item on payslips, and ensure that overtime calculations include travel hours.

Q: Do per-diem allowances need to be changed?

A: Yes. Per-diems must not offset the mandatory paid travel time. Employers should split allowances into mileage reimbursement and an hourly travel-time component to remain compliant.

Q: What are the risks of not updating collective bargaining agreements?

A: Outdated CBAs can lead to grievances, retroactive pay claims, and class-action lawsuits. Courts may award damages at double the regular hourly rate for each uncompensated travel minute.

Q: How can companies protect employee privacy when using GPS tracking?

A: Limit GPS tracking to the exact travel interval, store data securely, restrict access to payroll staff, and be transparent with employees about how the data will be used.