RISKVUE ARCHIVE | INDUSTRY WATCH > NONPROFITS

Department of Labor Offers Guidance on Employees as Volunteers

By James P. Wilkins

This past fall, the U.S. Department of Labor (“DOL”) issued a series of opinion letters clarifying when a “volunteer“ is truly a volunteer and therefore not entitled to compensation under the Fair Labor Standards Act. The issue generally arises when a non-exempt employee agrees to put in additional time for some civic or charitable effort sponsored by the employer. The DOL has always been somewhat suspicious of “volunteer” arrangements because of their potential use as a means to circumvent the minimum wage and overtime requirements of the FLSA.

Under the FLSA, a non-exempt employee must generally be paid time and one half his/her regular hourly rate for all hours worked in excess of forty in a workweek. However, under certain circumstances, time spent by such employee volunteering for his/her employer will not be counted as hours worked and therefore no additional compensation will be required for such volunteer work.

In its latest releases, the DOL expressly recognized “the generosity and public benefit of volunteering,” and sought to eliminate obstacles to “bona fide volunteer efforts for charitable and public purposes.” Based on the guidance issued by the DOL, volunteer status will most clearly be established when certain criteria are satisfied:

• Designation of “volunteer” status is not done unilaterally by the employer to avoid minimum wage or overtime requirements;
  
  
• The volunteer time must be for a civic, charitable, or humanitarian purpose without any promise, expectation or receipt of compensation by the employee (though a nominal fee may be provided);
  
  
• The act of volunteering truly must be voluntary, without any direct or implied coercion from the employer;
  
  
• The employee’s volunteer activities must not be similar to the services he/she performs as part of his/her regular employment; and
  
  
• The volunteering must be performed outside the employee’s normal work hours.

The DOL permits a “nominal” payment to an employee for performing additional volunteer services without destroying the volunteer nature of that service. For example, a non-exempt school custodian can volunteer to coach one of the school’s sports teams without the employer being required to compensate the individual for all hours spent coaching. The school can even pay the volunteer coach a stipend, so long as it is nominal when compared with what would be paid if someone were hired to do the job. Such stipends may not be a substitute for compensation and cannot be tied to productivity or the amount of time devoted to the volunteer activity.

Though not specifically required by the DOL opinion letters, an employer who permits an employee to perform volunteer services is well advised to have a written understanding with the employee to help assure that each of the foregoing criteria are satisfied. For a sample “Acknowledgement of Volunteer Status” form, please contact Jim Wilkins, jwilkins@kwwlaborlaw.com.

ABOUT THE AUTHOR

James P. Wilkins has been practicing labor and employment law for over 20 years. His practice is devoted to advising employers on employment and labor matters, including compliance with all state and federal employment laws.

This article originally appeared in the Winter 2006 issue of kwwlaborlaw.communicator, a publication of Kastner Westman & Wilkins, LLC. Reprinted with permission.

riskVue | The webzine for risk management professionals
May 2006