New DOL Opinion Letters Clarify Non-Exempt Work, Overtime, Bonuses, Meal Breaks, and Pre-Shift Work

by Shuping Li and Sydney D. Finlay

On May 29, 2026, the U.S. Department of Labor’s Wage and Hour Division (DOL) issued four new opinion letters in response to public inquiries about recurring issues under the Fair Labor Standards Act (FLSA). The letters address whether exempt employees can perform additional hourly work and the overtime implications of that work, how certain bonuses should be treated when calculating overtime pay, when time spent moving through an employer’s premises during a meal break is compensable, which pre-shift activities by hospital employees count as compensable work, and when employer time-rounding practices create wage-and-hour risk.

These opinion letters are official interpretations of governing regulations and laws and represent the DOL’s renewed focus on using official written guidance to explain how federal wage-and-hour rules apply to specific workplace situations.  The letters address practical issues that frequently appear in workplace disputes, inform employees about whether they are receiving proper compensation under the FLSA, and provide guidance to employers on how to remain compliant with the FLSA.

FLSA2026-5: Exempt Employees May Perform Additional Non-Exempt Work Without Losing Their Exemption

The FLSA2026-5 opinion letter concerns an academic medical center employing Nursing Professional Development Specialists (“Specialists”) that it classified as exempt employees and paid salaries on bi-weekly schedules.  These Specialists occasionally pick up additional shifts as non-exempt Staff Nurses, typically one or two 12-hour weekend shifts per week (representing 23-38% of total weekly hours), for which they receive hourly compensation at a rate approximately equivalent to their guaranteed weekly salary divided by 40 hours.

The FLSA requires covered employers to pay non-exempt employees at least the federal minimum wage for all hours worked and overtime at one and one-half times the regular rate for all hours worked over 40 in a workweek. However, Section 13(a)(1) of the FLSA exempts employees working in a “bona fide executive, administrative, or professional capacity” from minimum wage and overtime requirements. For the exemption to apply, an employee’s “primary duty” must be exempt work. Federal regulations define an employee’s primary duty as the “principal, main, major or most important duty that the employee performs.” Determination of primary duty is based on all facts, with major emphasis on the character of the job as a whole, considering factors including the relative importance of exempt duties, time spent performing exempt work, freedom from supervision, and the relationship between salary and wages paid to non-exempt employees.

An employee who spends more than 50 percent of time performing exempt work will generally satisfy the primary duty requirement, though employees spending less than 50 percent on exempt duties may still meet the requirement if other factors support that conclusion.  There is no strict percentage limitation on performance of non-exempt work as long as the employee’s primary duty remains exempt work.

To qualify as exempt, an employee must be compensated on a salary basis at a rate equaling or exceeding the regulatory minimum ($684 per week).  The salary basis requirement is met if the employee regularly receives each pay period a predetermined amount constituting all or part of compensation, which is not subject to reduction because of variations in work quality or quantity.   An exempt employee must receive the full salary for any week in which the employee performs any work without regard to days or hours worked.

An employer may provide additional compensation to salaried employees without violating the salary-basis requirement if the employee is guaranteed at least the minimum weekly amount paid on a salary basis.  Such additional compensation may be paid on any basis, including flat sum, bonus payment, straight-time hourly amount, time and one-half, or any other basis.

The DOL concluded that the Specialists who pick up additional Staff Nurse shifts retain their exempt status because their “primary duty” remains the performance of exempt work.  Because the Staff Nurse shifts constitute only 23-38% of total weekly hours as a supplement to exempt work, the Specialists spend the substantial majority of time (approximately 40 hours per workweek) in the Specialist role, thus satisfying the primary duty requirement.

The Specialists’ base pay per week exceeds the $684 minimum salary level and meets the salary-basis requirement because the employees receive the full Specialist salary for all work performed during the week, regardless of hours worked.  The additional hourly compensation for Staff Nurse shifts does not violate the salary-basis requirement because regulations permit additional compensation based on hours worked beyond the normal workweek, paid on any basis including straight-time hourly amounts.

FLSA2026-6: Quarterly Percentage-of-Total-Earnings Bonuses May Satisfy FLSA Overtime Requirements

The FLSA2026-6 opinion letter concerns an employer paying certain employees a quarterly bonus drawn from a bonus pool, with each employee’s portion based on the employee’s total gross compensation (straight-time earnings paid at the employee’s regular rate without the additional overtime premium, plus overtime earnings) as a percentage of the total gross compensation paid to all eligible employees for the quarter. The employer does not provide additional overtime pay on the quarterly bonus, believing it constitutes a percentage-of-total-earnings bonus.

Non-discretionary bonuses must be included in the regular rate, as the Department of Labor reaffirmed in a January 2026 opinion letter. A bonus is discretionary only if both the fact of payment and the amount are determined at the employer’s sole discretion at or near the period’s end and not pursuant to any prior contract, agreement, or promise causing employees to expect such payments regularly.

When bonuses are determined and paid after the workweeks in which they are earned, an employer may disregard the bonus in computing the regular hourly rate until the amount can be ascertained, then apportion it back over the workweeks and calculate additional overtime compensation due.  However, a “percentage of total earnings” bonus—one that increases both straight-time and overtime wages by the same percentage—provides simultaneous payment of overtime compensation due on the bonus and requires no recomputation.  Such bonuses satisfy the FLSA’s overtime provisions as an “arithmetic fact” and requiring additional overtime pay would impose overtime upon overtime.

The DOL concluded that the quarterly bonus constitutes a percentage-of-total-earnings bonus that provides simultaneous payment of overtime compensation due on the bonus, satisfying the FLSA’s overtime requirement without recomputation.  Although the bonus is calculated as a percentage of the bonus pool, each employee receives a bonus equal to the same fixed percentage of his or her total earnings—the bonus pool amount divided by the total earnings of all participating employees.

The opinion demonstrates through a mathematical example that when each employee’s bonus equals the percentage that his or her total earnings represents of all participating employees’ earnings, the bonus actually increases each employee’s pre-bonus overtime earnings by the same percentage as pre-bonus straight-time earnings.  This satisfies the principle that a percentage-of-total-earnings bonus increases both straight-time and overtime wages by the same percentage, thereby including proper overtime compensation as an arithmetic fact.

Additionally, the DOL cautioned that employers may not use percentage-of-total-earnings bonuses to evade overtime requirements, such as where the percentage bonus decreases in direct proportion to increases in hours worked over 40.  Employers also may not dilute overtime earnings by applying a higher percentage increase to straight-time earnings than overtime earnings or by including items previously excluded from the regular rate.

FLSA2026-7: Meal Break Time Voluntarily Spent Traveling Off-Site May Not Be Compensable

The FLSA2026-7 opinion letter concerns an employee working at a large, secured facility with controlled access points and parking located a significant distance from work areas.  The employer provides an unpaid 30-minute meal period during which employees may leave the premises or remain on-site.  Due to the 5 to 10 minute walk to the parking lot and additional security gate delays, employees who go off-site are left with only 10 to 15 minutes for their meal.

Bona fide meal periods are not compensable work time if the employee is relieved from duty for purposes of eating regular meals.  Typically, 30 minutes or more is long enough for a bona fide meal period.  It is not necessary that an employee be permitted to leave the premises if the employee is freed from duties during the meal period.

The Portal-to-Portal Act amended the FLSA to clarify that it does not require compensation for walking, riding, or traveling to and from the actual place of performance of principal activities, or for activities that are preliminary or postliminary to principal activities.  An employee’s principal activities include all activities that are “integral and indispensable to the principal activities that an employee is employed to perform,” meaning they are an intrinsic element of those activities with which the employee cannot dispense.

The DOL concluded that the employer provides a bona fide meal period because employees are relieved from work duties during the 30-minute break, and the period is sufficient to allow use for eating a meal.  The regulation expressly provides that it is not necessary for employees to be permitted to leave the premises for a meal period to be bona fide, as long as employees are freed from duties.

Because the employer may lawfully require employees to remain on premises for the meal period, the fact that an off-site meal may be difficult to undertake in the time provided does not affect whether employees receive a bona fide meal period.  An employer is not obligated to exclude from a bona fide meal period, or consider as compensable, time voluntarily spent to travel off-site to acquire or eat a meal.

In the facts presented, there is no indication that the employer requires employees to work during meal periods when present at the worksite, and it appears employees are relieved from work responsibilities during that time, giving them discretion to use the period for eating or personal matters.

FLSA2026-8: Hospital Pre-Shift Timekeeping and Rounding Practices May Not Comply With Compensable Hours Worked Requirements

The FLSA2026-8 opinion letter concerns a public hospital employing approximately 18,000 non-exempt employees that provides flexibility to clock in up to 7 minutes early to avoid tardiness caused by limited timekeeping stations.  The timekeeping system rounds early clock-ins to the scheduled shift time.  Employees, including respiratory therapists, routinely engage in pre-shift work activities immediately after clocking in, such as equipment preparation, chart review, locating work assignments, and receiving handoff reports.  The hospital does not compensate employees for this pre-shift work.

Compensable integral and indispensable activities may include donning and doffing required protective gear, performing mandatory equipment checks, and booting up computer systems required to begin work.  Conversely, time spent waiting to clock in, walking from a time clock to a workstation, and other pre- or post-shift activities not integral and indispensable are not compensable if they occur before or after an employee’s first or last principal activities.

Under the de minimis doctrine, insubstantial or insignificant periods of time beyond scheduled working hours, which cannot as a practical administrative matter be precisely recorded for payroll purposes, may be disregarded.  The doctrine applies only where there are uncertain and indefinite periods of a few seconds or minutes duration, and where failure to count such time is due to considerations justified by industrial realities.

Employers may practice time rounding to the nearest fraction of an hour, but only if it will not result, over a period of time, in failure to compensate employees properly for all time actually worked.  A rounding practice must both be neutral on its face and average out over time so it does not consistently favor the employer.

The DOL concluded that some of the pre-shift activities are integral and indispensable to employees’ principal job duties and therefore compensable, while other activities are preliminary or postliminary and not compensable.  For example, for the respiratory therapists, receiving handoff reports regarding patient status is essential because therapists cannot safely begin patient care without understanding each patient’s current medical condition and ongoing treatments.  Similarly, locating work assignments is necessary because therapists must know which patients they are responsible for before performing treatment duties.

However, time spent waiting in line to clock in and out is not compensable because it is not integral and indispensable to the job employees are hired to perform.  This principle applies even when waiting occurs on the employer’s premises.

Regarding the de minimis doctrine, the DOL concluded that to the extent employees perform compensable work prior to paid shifts commencing on a daily basis, such work is unlikely to be de minimis because an employer may not arbitrarily fail to count any part of an employee’s fixed or regular working time.  Conversely, to the extent pre-shift compensable work is irregular, the practical administrative difficulty of recording the time may justify treating it as de minimis.

The DOL emphasized that employers should implement and enforce clear policies prohibiting work-related activities outside scheduled shifts and that management must exercise control to ensure work is not performed if it does not want it performed.  If an employer clearly instructs employees to refrain from beginning work until their shift starts, warns that unauthorized off-the-clock work may result in discipline, and enforces such rules, it may be excused from compensating occasional off-the-clock work completed without the employer’s actual or constructive knowledge.

Regarding the rounding policy, the DOL concluded that if employees are performing compensable work after clocking in but before paid shifts, the hospital’s rounding practice is not neutral because it rounds early check-ins to scheduled shift time, exclusively benefiting the employer without ever benefiting employees.  Employees who perform compensable work during the early check-in period are always uncompensated for that time and are not afforded a chance for over-compensation to average that time.  However, if the rounding practice is facially neutral and operates such that employees benefit in other circumstances—for example, if late arrivals are credited with starting at scheduled time and that practice averages out over time—the policy would likely comply with regulatory requirements.

Key Takeaways for FLSA Compliance

These four DOL opinion letters provide employers with critical guidance on FLSA compliance across diverse employment scenarios. Together, they emphasize that classifications, compensation formulas, meal-period policies, and timekeeping practices must reflect the work employees actually perform. Because each opinion is fact-specific, even small differences in workplace practices may affect the analysis.

The legal team at Miller Shah LLP can offer legal assistance when it comes to labor and employment litigation and compliance. Miller Shah LLP has extensive experience representing labor and employment matters, including wage and hour violations, employee misclassification, and more. If you have any questions regarding this subject or this post, please fill out a form or call us toll-free at (866) 540-5505.