Compensation for Employee Training Just Got Easier

August 30, 2016

By Cara Pilgrim
When employees spend time on e-learning, under the Fair Labor Standards Act (FLSA), an employee must be compensated for all “hours worked,” including training time. To alleviate this strain, Inspirus is bringing compensation reports into the equation, because keeping track of hours isn’t always as simple.

Learning within the workplace is shifting, and as we mentioned in the previous blog post, allowing employees to have more control of their own learning has a great impact on how engaged they are as well as the knowledge they retain. That is why Inspirus utilizes micro-learning, a type of learning that breaks important information into smaller chunks for users to easily comprehend. The only problem, however, is since micro-learning can be done at any time, even after hours and outside of the workplace, it’s difficult to properly compensate hourly employees without a way to measure the amount of time they spend on e-learning. 

Under the Fair Labor Standards Act (FLSA), an employee must be compensated for all “hours worked,” including training time. To alleviate this strain, Inspirus is bringing compensation reports into the equation, because keeping track of hours isn’t always as simple as clocking in and clocking out anymore. Now, organizations can get a basis for compensation of training pay and keep up with the amount of time hourly workers spend on micro-learning courses, which in turn eases the burden for management and increases the accuracy of an employee’s wages.

3 Things to Know About Compensation Reports

1.  Do they work?

Absolutely. Our team at Inspirus is creating an easy and accurate way to measure the time an employee spends on micro-learning modules so that they can be properly compensated. The compensation reports will include all the time-based statistics that are generated when an employee takes a micro-learning course. With the reports, management will be able to see who took what course, how long each person took to complete the course, and how much they need to be compensated.

Traditional forms of training, such as instructor-led classes, can last anywhere from a few hours to a few days, which makes it easier to compensate employees for learning because it’s simple to track. Micro-learning takes about five minutes for each course, drastically reducing the amount of time spent on training. However, this form of learning becomes more complicated to monitor since it doesn’t have to be done on a fixed time schedule.

“We are the only engagement company that offers micro-learning paired with a game-based approach to retention—a complement to a Learning Management System (LMS). Employees must be paid for this training. This can be burdensome for learning leaders, as reporting metrics may not be available. Micro-learning and the ability to access compensation reports will shift the paradigm not only in the way learning is delivered, but as a new way for organizations to pay employees for a shorter amount of time in training,” said Wendi Walker-Schmidt, director of engagement solutions-learning at Inspirus.

2.  How compensation reports apply to the Fair Labor Standards Act

While the compensation report itself is a pretty simple concept to grasp, figuring out if an employee is eligible for compensation for a training course can get a little tricky. According to the U.S. Department of Labor and the FLSA, an employer is not required to compensate an employee if attendance is voluntary, outside of normal work hours, not directly related to the job, or if the employee does not perform any productive work while attending training.

“The Fair Labor Standards Act’s application to training is a bit murky,” said Elliot Hay, director of learning products at Inspirus. “Learning anywhere at any time is a great thing, but it creates problems on the policy side. Does the company compensate all off-hour training? How does the company know the employee was off-hours? With that in mind, our compensation reports give companies the information they need to follow their own processes and policies.”

3.  Compensation reports adhere to FLSA regulations

Inspirus compensation reports give employers a basis for training pay and the tools they need to adhere to the FLSA. That way, if an organization were ever to be audited by the FLSA, they could prove that employees were, in fact, being compensated for training pay. For example, if an hourly employee were to complete a course, the compensation report would then provide the employer with the data they need to calculate how much compensation an employee is owed. This data includes how long it took an employee to complete the course, when the course was taken, and the average amount of time it should take a participant to finish the course.

“Learning and HR leaders can download the compensation report from our application and upload it into their Human Resource Information System (HRIS) to pay employees for their training, thereby staying within the FLSA,” said Walker-Schmidt.

Our compensation reports will create a win-win for everyone. HR and learning leaders can have peace of mind that employees are being properly compensated for their online training, while increasing the overall knowledge of an organization and its employees, and as an added benefit—making for more engaged employees.