Q&A: Paying Employees for Holiday Party Time

Paying Employees for Holiday Party Time

Question: We are preparing for our company’s annual holiday party and have two questions about pay for nonexempt employees. First, our party is from 3 – 7 p.m.; however, several nonexempt employees typically leave work at 5 p.m. Do we have to pay these employees for attending the party from 5 – 7 p.m.? Second, if any of our nonexempt employees volunteer to stay after and clean up, do we have to compensate them for their time?

Answer: In answer to your first question, it depends. 

If the after-hours party is voluntary and there are no consequences for not attending, the employer is not required to compensate nonexempt employees under wage and hour regulations. However, if a party is held during any portion of the employees’ normally scheduled work hours and employees are permitted to attend during those hours, even if voluntarily, the employees should be compensated.

If your party is strictly voluntary and the employees attend the party, you would pay them for the hours they would normally work (until 5 p.m.). You would not have to pay the employees for any additional after-hours time spent at the party. If, however, attendance at your party is mandatory or employees believe there would be consequences if they do not attend, you should pay nonexempt employees for the entirety of the party.

As for your second question, if a nonexempt employee is staying after the party to assist with clean up, then the employee would be compensated for all time worked at regular wages, including any eligible overtime.

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Jo McClure

Written by Jo McClure