Do I have to pay for time spent in lunch and learns?
Question: Every once in a while we have reps come present a product and buy the staff lunch. Attendance is completely optional. Do I have to compensate employees who choose to attend even though it’s during their lunch break?
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The Legal Side: Yes. For nonexempt employees, the job-related lunch and learn you described is paid time. Making attendance optional does not change that.
Under federal rules, unpaid training must meet four conditions: it happens outside regular working hours, attendance is genuinely voluntary, it is not directly related to the employee’s job, and no productive work takes place. A presentation about products your team uses at work does not meet that test simply because someone brings lunch. FLSA Hours Worked Advisor
Record the time and include it when calculating overtime. Also, make sure employees receive any separate meal break required by state law. Eating while participating in training is not the same as being relieved of work duties.
The Human Side: A useful presentation and a free lunch can be a nice combination. Just budget for employees’ time along with the food.
Before booking a rep, ask what your team will learn and whether it will help them do their jobs. If the presentation is worth their time, schedule it as paid training. If it is mostly a sales pitch with sandwiches, you can say no.
Tell employees whether attendance is required or optional and confirm that those who attend should stay clocked in.
Listen: You Can’t Pay Employees With a Free Lunch During Lunch & Learns
Bonus Episode: Episode 109: You Can’t Pay People in Chicken
Can I have my holiday party during work hours?
The Legal Side: Yes. You can set aside part of the workday for a holiday celebration. Keeping employees on the clock for a planned daytime gathering is the simplest approach.
If you want to host an unpaid holiday lunch, it needs to be a genuine, voluntary meal break with employees completely relieved of work duties. That means no answering phones, checking out patients, or keeping an eye on the front desk while everyone else eats. State meal-period requirements still apply. U.S. Department of Labor
For a gathering outside regular working hours, attendance can be unpaid when it is genuinely voluntary, purely social, and employees perform no work. Required attendance or assigned duties can make that time compensable for nonexempt employees. Holding the party at a restaurant or your home does not, by itself, settle the pay question.
The Human Side: A holiday lunch can be a thoughtful way to thank your team without asking them to give up an evening. A dedicated 60- to 90-minute gathering gives everyone time to eat and enjoy each other’s company before returning to work.
But plan the coverage. The person answering phones through lunch is still working, even if someone saves them a plate.
If you prefer an after-hours party, consider whether inviting spouses or partners fits your team and budget. Keep participation voluntary, and don’t turn someone’s absence into a test of how much they care about the practice.
We recommend skipping alcohol when the celebration is part of the patient-care workday. If you serve it at an after-hours event, plan limits and safe transportation. Workplace conduct policies still apply.
For more planning guidance: Office Holiday Party Guidance
Listen: Episode 207: Holiday Party Guidance
Can we give employees a monthly stipend to purchase their own health insurance?
Question: We’re a small practice and figured out we needed to offer health insurance to help keep and attract employees. I’ve started looking into it, but it feels complicated. I’m thinking, why not just give them a little extra each month for health insurance? Can’t they take that and get their own, or maybe just treat it as additional income?
The Legal Side: You can increase employees’ taxable wages and let them decide how to spend the money. Paying or reimbursing their individual health insurance premiums is a different arrangement and needs to be structured correctly.
That distinction matters. Unrestricted extra compensation, with no requirement to purchase coverage and no endorsement of a particular policy or insurer, is not the same as an employer health plan. But calling a premium reimbursement “taxable income” does not remove the health-plan rules. IRS Notice 2015-17
An informal reimbursement arrangement can violate Affordable Care Act requirements and expose the employer to an excise tax of $100 per affected employee, per day. Internal Revenue Service
One option for eligible small employers is a Qualified Small Employer Health Reimbursement Arrangement, or QSEHRA. It allows reimbursement of individual insurance premiums and other eligible medical expenses, with tax-free treatment when the requirements are met. Eligibility generally requires fewer than 50 full-time employees, counting full-time equivalents, and no group health plan. There are also annual limits, employee notices, and documentation requirements. Internal Revenue Service
Before promising a monthly insurance benefit, have a qualified benefits administrator or broker help you choose and establish the arrangement. If you already reimburse premiums informally, have that reviewed too. Setting up a new plan does not automatically resolve earlier payments.
The Human Side: Your instinct makes sense. You want to help employees afford coverage without taking on more complexity than your practice can manage.
Start with what you can consistently afford, then compare what employees would receive through additional wages, group insurance, or a formal reimbursement arrangement. With a QSEHRA, also consider how the benefit could affect employees’ Marketplace premium tax credits. HealthCare.gov
Explain the benefit accurately. Extra taxable pay gives employees flexibility, but it is not the same as providing health insurance. A reimbursement arrangement has its own eligibility and claims process. Employees need to understand what you are offering before they rely on it.
Our Employee Health Benefits Guide explains the options to discuss with your benefits professional.