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Outbyte Driver Updater FREEScan for outdated or missing drivers - takes under a minuteDriver Scan →Outbyte PC Repair FREERepair Windows errors before they cause bigger problemsFix Now →Billable travel time is time a business charges a client for under the engagement terms; nonbillable travel time is time it does not charge the client for. Those labels do not determine whether an employee must be paid. U.S. wage rules and client billing terms answer different questions, so a trip can be nonbillable to a client but still count as compensable work time.
What do “billable” and “nonbillable” mean?
Billability describes how a provider accounts for time on a client invoice. The contract, statement of work, client billing guidelines, rate schedule, and approval rules determine whether travel is billed at a full rate, a reduced rate, a flat fee, or not billed.
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Nonbillable does not necessarily mean unproductive or unpaid. A company may track travel time as overhead, for example, while still paying an employee for that time. Conversely, a contract may permit charging a client for travel without settling the separate question of how a worker must be paid.
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Does nonbillable travel time still have to be paid?
For employees covered by the federal Fair Labor Standards Act (FLSA), the relevant question is generally whether the time counts as hours worked—not whether the employer can invoice a client for it. The U.S. Department of Labor (DOL) summarizes the rule this way: “Time spent traveling during normal work hours is considered compensable work time.” Its detailed guidance distinguishes among types of trips, so that summary should not be read to mean every trip is paid. See the DOL Travel Time topic page and Fact Sheet #22.
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Ordinary commute: home to the regular workplace
Ordinary travel from home to work and back is generally not hours worked under the DOL’s federal guidance. That baseline can change when work duties are performed during the commute or the circumstances otherwise differ from an ordinary commute.
Travel between work locations during the workday
Travel from one job site to another during the workday is generally work time. The DOL says this applies whether the employee travels as a passenger or uses an employer-provided vehicle. Whether the client is billed for that segment is a separate contractual decision.
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A one-day assignment in another city
Travel for a special one-day assignment in another city is generally work time, but the employer may subtract the time the employee would normally spend commuting to the regular worksite. The normal-commute adjustment is part of this specific rule; it is not a blanket deduction for every business trip.
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For overnight travel, time that cuts across an employee’s normal working hours generally counts as work time, including on days the employee would not ordinarily work. Under a DOL enforcement policy, passenger time outside normal working hours on an airplane, train, boat, bus, or automobile is generally not counted, subject to circumstances such as work performed during the trip and other applicable conditions.
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Work during a commute or travel segment
Specific duties can change how a trip is treated. The DOL’s eLaws guidance says travel that is part of the day’s work must be counted regardless of contract, custom, or practice, and its 2026 opinion letter FLSA2026-10 discusses job-to-job travel and work performed during otherwise noncompensable commute time. The letter addresses a particular fact pattern involving an employee who receives pages, schedules appointments, and drives from home to a first client appointment; its analysis should not be assumed to decide a different situation. Read the full FLSA2026-10 opinion letter before applying it to a similar but not identical arrangement.
How to decide whether travel can be billed to a client
There is no universal client-billing rule in the federal wage-hour guidance. Check the documents and policies that govern the engagement instead of assuming that all travel is billable, or that none of it is.
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- Find the controlling terms: Review the signed agreement, statement of work, client billing guidelines, and any written approvals or rate schedules.
- Identify the billing method: Determine whether travel time is billed at the standard hourly rate, a reduced rate, a flat fee, or not charged.
- Check distance and authorization rules: Look for local-versus-long-distance distinctions, mileage or distance thresholds, and any requirement for client approval before travel.
- Separate time from expenses: Find out whether the agreement treats travel hours separately from mileage, airfare, lodging, meals, and other costs.
- Apply the relevant policy consistently: Record the travel segment and use the rate and billing code the agreement specifies.
A professional-services agreement filed with the SEC in 2005 illustrates how terms can vary: it provides for travel beyond 25 miles from the firm’s office to be billed at half the listed rates and says travel below 25 miles is not charged. That is an example of one negotiated agreement, not a general market standard or a legal rule. Read the filed agreement.
How should travel time be documented?
Record travel clearly enough to support both payroll and client billing decisions. A useful entry identifies the employee, date, client or project, trip segment, purpose, start and end times, and any work performed while traveling. Keep time separate from mileage and other expenses so each can be handled under the applicable rule.
For federal procurement, FAR 31.205-33 addresses allowable professional and consultant service costs and calls for supporting records that describe the agreement, the services performed, and the time spent. That requirement applies in its federal procurement context; it does not automatically govern every private client relationship. The same practical discipline—clear time and service records—helps reconcile hours to a contract. See FAR 31.205-33.
A practical way to classify a trip
Classify the trip on two separate tracks: first determine its treatment for employee pay, then determine whether and how it may be charged to the client.
- Describe the segment: Is it an ordinary commute, travel to a special assignment, travel between sites, or overnight travel?
- Note the timing and duties: Record whether the trip overlaps normal work hours, whether the employee worked or had to remain available, and whether the employee was otherwise relieved from duty.
- Apply the wage rules that cover the worker: Check the federal baseline and any applicable state or local law, worker classification, collective agreement, employment contract, or industry rule.
- Apply the client terms separately: Use the engagement’s rate, distance, expense, and approval provisions to determine what can be invoiced.
- Keep a record of both outcomes: A time entry can be compensable for payroll while coded nonbillable for client accounting; document each treatment and its basis.
What changed in 2026?
On July 22, 2026, the DOL announced opinion letters FLSA2026-9 and FLSA2026-10 addressing travel-related questions, including voluntary mid-day travel between home and an office where work occurs at both locations, and an employee who receives pages, schedules appointments, and drives from home to the first client appointment. These letters are fact-specific, not a universal rule for every remote-work or first-appointment commute. The DOL announcement is available at the July 22, 2026 release.
What to keep in mind
This is a U.S. federal overview, not a survey of state or local requirements. Laws outside the federal baseline, worker status, collective agreements, industry rules, and the exact facts of a trip may affect employee-pay treatment. Client billing remains governed by the engagement terms and applicable billing rules. The DOL’s fact sheet is general compliance assistance, not an official position with the force and effect of law; an individual wage dispute may require advice based on its specific facts.
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