Employment Law Update: Department of Labor Opinion Letter Highlights Risks of Rounding Employee Worktime
Date: June 3, 2026
By:
David M. Stevens
The scenario involved a hospital with many non-exempt employees. The hospital’s policy allowed employees to clock in up to seven minutes prior to their scheduled shift to avoid tardiness that might otherwise result from bottlenecks at the hospital’s timekeeping stations. In that event, the timekeeping system would round time entries to the scheduled start time, meaning that if the employee clocked in at 6:53 a.m., they would not be paid for any time prior to 7:00 a.m. Similarly, if an employee was delayed for several minutes after the scheduled end of their shift, the system would round the employee’s time entry to the scheduled end time of his or her shift. The letter further explained that employees “routinely engage in pre-shift work activities immediately after clocking in–even when they clock in early.”
The Department’s opinion letter responded to those facts by noting that a rounding policy “only affects the calculation of hours worked to the extent that employees are performing compensable work between the clock-in/out time and the rounded time.” The letter went on to explain that if employees are performing such work immediately after clocking in, a timekeeping practice under which working time is routinely rounded off and remains uncompensated “would result in a failure to properly record, as well as potentially to properly compensate for, all hours worked.”
The letter noted, however, that if the rounding policy was neutral – i.e., if it rounded time for any employees who clocked in several minutes after the start of their shift so that the employees were paid as though they had clocked in at the scheduled time – and the practice averaged out over time to offset any work time lost due to the rounding of early clock-ins, the policy would likely comply with the requirements of the Fair Labor Standards Act.
The Department’s opinion letter reinforces the need for employers utilizing time clocks or other electronic timekeeping devices to ensure that their payroll practices do not operate in a manner that consistently undercalculates the amount of working time performed by employees. Employers with questions about wage-and-hour requirements are encouraged to reach out to Whiteford’s Employment Law team for guidance.
The information contained here is not intended to provide legal advice or opinion and should not be acted upon without consulting an attorney. Counsel should not be selected based on advertising materials, and we recommend that you conduct further investigation when seeking legal representation.