On May 14, 2008, Rep. McMorris Rodgers (R-WA) introduced legislation that would allow an employer to offer its employees the option of receiving paid time off in lieu of overtime wages. The Family-Friendly Workplace Act (H.R. 6025) would amend the Fair Labor Standards Act (FLSA) to permit employers to offer paid time off at a rate of one and a half hours of paid leave for each hour of employment for which overtime pay would ordinarily be required. The bill, which has 11 Republican cosponsors, has been referred to the House Committee on Education and Labor.

Under the bill, an employee would have to consent in writing to swap paid time off for overtime, and would be able to withdraw his or her request for the arrangement at any time. An employer would also have to pay out any accrued time within 30 days of receiving an employee’s written request. No employee could accrue more than 160 hours of compensatory time, and employers could provide monetary compensation for an employee’s unused accrued time in excess of 80 hours at any time after giving 30 days notice. 

The legislation would also require employers to set a twelve-month schedule and pay out any unused accrued compensatory time once a year. Employees agreeing to receive compensatory time off would have to have worked for the employer at least 1,000 hours in the preceding twelve months. An employer could only offer paid time instead of overtime to unionized employees in accordance with a collective bargaining agreement. Employers offering paid time off for overtime could discontinue the option at any time with 30 days notice to the employees, unless a collective bargaining agreement provided otherwise.