	Introduction

On May 8, 2013, the U.S. House of Representatives passed H.R. 1406 , the Working Families Flexibility Act of 2013. If enacted, the bill would amend the Fair Labor Standards Act (FLSA) to allow private sector employers to provide paid leave in the future ( compensatory time or comp time ) in lieu of overtime pay when the overtime is worked. Under H.R. 1406 , compensatory time would be available only when an employer and employee (or representative of the employee) agree to replace overtime wages with paid time off. Compensatory time would be accrued at a rate of not less than one and one-half hours of comp time for each hour of employment for which overtime pay is required. In October 2013, a Senate version of the Working Families Flexibility Act ( S. 1623 ) was introduced. The bill's language was identical to the House-passed version of H.R. S. 1623 was referred to the Senate Committee on Health, Education, Labor, and Pensions but, as of this writing, has seen no further action. §207) specifies that employers must pay covered workers at least one and one-half times their regular hourly wage for hours worked in excess of 40 in a single work week. The largest group of workers who are exempt are bona fide executive, administrative, and professional employees (the "EAP exemption"). H.R. Under the act, an employee would be eligible to accrue a maximum of 160 hours of comp time. 1406 , the use of comp time in lieu of overtime wages would be optional for both the employer and employee. H.R. 1406 would allow employees to withdraw from a comp time agreement and return to overtime wages at any time. Employees who withdraw from a comp time agreement may also request to have any unused comp time converted to a cash payment. An employee may request unused comp time to be converted to monetary payment at any time. If employment is terminated, either voluntarily or involuntarily, unused comp time must be converted to a monetary payment. Under H.R. 1406 , the changes to the FLSA made would expire five years after enactment.
On May 8, 2013, the House passed H.R. 1406, the Working Families Flexibility Act of 2013. If enacted, this bill would amend the Fair Labor Standards Act (FLSA) to allow private sector employers to provide future paid leave (compensatory time or comp time) in lieu of overtime wages.
Under current law, the FLSA requires employers to pay covered, nonexempt employees one and one-half times their regular hourly wage ("time and a half") for any hours worked in excess of 40 in a single work week. If enacted, H.R. 1406 would give employers and employees the option to agree to replace overtime wages with one and one-half hours of paid time off for each hour of overtime worked. H.R. 1406 would not affect workers who are not presently covered by, or are exempt from, the overtime provisions of the FLSA such as many executive, administrative, and professional employees.
Under H.R. 1406, the replacement of overtime wages with comp time would be optional for both employers and employees. If an employer and an employee (or the representative of the employee) enter into a comp time agreement, either party may terminate the agreement. If such an agreement is terminated, any unused comp time would be converted to a cash payment to the employee.
Under a comp time agreement, employees would be permitted to accrue up to 160 hours of comp time. Once a year, employers would be required to convert all unused comp time to a monetary payment. Accrued comp time would also be converted to a monetary payment upon the voluntary or involuntary termination of an employee.
If enacted, the comp time provisions of H.R. 1406 would expire five years after enactment.
In October 2013, a Senate version of the Working Families Flexibility Act (S. 1623) was introduced. The bill's language was identical to the House-passed version of H.R. 1406. S. 1623 was referred to the Senate Committee on Health, Education, Labor, and Pensions but, as of this writing, has seen no further action.