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Home » Are You Required to Pay Employees During Onboarding?

Are You Required to Pay Employees During Onboarding?

by | Jan 3, 2024 | HR Legal Compliance

When executed effectively, the onboarding phase stands out as a crucial and impactful initial stage in a new employee’s role. Although onboarding procedures may differ across organizations, the question arises: are employers required to pay their employees for the time dedicated to onboarding activities?

What Constitutes Onboarding?

Employee onboarding is the process of assimilating a new employee into an organization by imparting the requisite knowledge, skills, and behaviors essential for success in the assigned role. This comprehensive process often encompasses tasks ranging from completing paperwork to acquainting the individual with colleagues and familiarizing them with the company’s culture.

Are Employees Entitled to Compensation for Onboarding?

Indeed, employees should receive compensation for the time spent on onboarding. According to the Fair Labor Standards Act (FLSA), the definition of employment encompasses individuals who are “suffered or permitted to work,” as per the Department of Labor.

Furthermore, the DOL specifies that a typical workweek includes the time during which an employee is required to be on the employer’s premises, on duty, or at a specific work location. A “workday” is generally defined as the period when an employee engages in their “principal activity.” Consequently, the DOL emphasizes that the workday might extend beyond the employee’s scheduled shift or hours.

The DOL establishes criteria to determine whether time spent in meetings and training programs should be considered as working hours:

  1. The event, meeting, or training occurs outside normal business hours.
  2. Attendance is voluntary.
  3. It is not job-related.
  4. No other work is being performed.

If all four criteria are met, employers are not obligated to compensate the employee. However, since onboarding is typically mandatory, occurs during business hours, and involves paperwork completion, employees are generally entitled to payment for the time spent during onboarding.

Who Manages and Executes Employee Onboarding?

Ideally, the responsibility for onboarding should be shared between the HR department and the management and leadership teams, with neither party shouldering exclusive responsibility. While managers actively engage with new hires during onboarding, HR serves as a quality assurance entity. This collaborative approach ensures the success of the onboarding process, as HR’s oversight helps maintain organizational alignment and a commitment to delivering an exceptional new hire experience.

Certain aspects of onboarding, such as handling legal paperwork like I-9 and W-4 forms, may naturally fall under HR’s purview. However, in practice, the hiring manager should play a significant role in personally guiding the new hire through their initial day on the job.

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