Our church operates a preschool that employs six persons. We often have church employees volunteer to work in the preschool. They work 40 hours for the church, and then want to volunteer several hours during the same week working in the preschool. Their duties as preschool volunteers would not be the same or similar to the duties they perform as church employees. Are we required to pay these persons overtime compensation for the hours they work as volunteers?
I am frequently asked this question. A few years ago, I submitted the following question to the chief counsel’s office of the United States Department of Labor, Wage and Hour Division:
Must an employer pay overtime to an hourly employee who works 40 hours per week at a regular job, and also works additional hours for the same employer performing work unrelated to her regular employment. For example, assume that a church secretary works 40 hours each week, and several weeks during the year she works 5-10 additional hours doing custodial services. Must she be paid overtime for the custodial services, even though they are completely unrelated to her regular job? If so, at what rate?
Here is the answer that I received:
Yes. Section 788.115 of the regulations states that where an employee in a single workweek works at two or more different types of work for which different straight-time rates of pay (not less than minimum wage) have been established, the regular rate for that week is the weighted average of such rates. That is, the earnings for all such rates are added together and this total is then divided by the total number of hours worked for all jobs.
Here are some additional points for you to consider:
1. A church is not required to pay exempt employees overtime compensation for hours worked in excess of 40 during the same workweek. Exempt employees are administrative, executive, and professional employees who are paid a weekly salary of at least $455, and perform duties specified by law.
2. A church cannot make an employee exempt simply by paying him or her a salary. To be exempt, the employee also must perform the duties of an exempt employee, as prescribed by law.
3. In a 1983 opinion letter, the United States Department of Labor concluded:
Individuals who volunteer their services, usually on a part-time basis, to a church or synagogue not as employees or in contemplation of pay are not considered to be employees within the meaning of FLSA. For example, persons who volunteer their services as lectors, cantors, ushers or choir members would not be considered employees. Likewise, persons who volunteer to answer telephones, serve as doorkeepers, or perform general clerical or administrative functions would not be employees. However, in situations where the understanding is that the person will work for wages there will be an employment relationship. On the other hand, a bookkeeper could not be treated as an unpaid volunteer bookkeeper for the employing institution in the same workweek in which he or she is also an employee. (emphasis added)
4. The preamble to the DOL regulations cautions that “some state laws have stricter exemption standards than those described [in these regulations]. The FLSA does not preempt any such stricter state standards. If a state or local law establishes a higher standard than the provisions of the FLSA, the higher standard applies.” This is an important point. Several states have enacted legislation mandating a higher minimum wage than the federal minimum wage. However, when Congress enacts increases in the federal minimum wage, the federal rate will transcend some state minimum wage rates. So, it is important for church leaders to be aware of both the federal and state rates. Whichever is higher applies.
Richard R. Hammar is an attorney, CPA and author specializing in legal and tax issues for churches and clergy.