A substantive modification to the bill's duration and eligibility. v2 removes the overall Act's 5-year sunset provision, but introduces a 5-year duration specifically for the private sector compensatory time off mechanism within the Fair Labor Standards Act. It also formalizes and clarifies employee eligibility criteria within the core provision, and adjusts the GAO reporting schedule.
Working Families Flexibility Act of 2025
- Sponsor
- Rep. Miller, Mary E. [R-IL-15]
- Committees
- Education and Workforce Committee (primary)
- Last action
- Feb 12, 2026
Bottom line
The bill offers private sector employees the option to accrue paid time off instead of receiving immediate overtime wages, aiming to increase flexibility but raising concerns about potential employer pressure and the practical ability to use accrued time.
What it actually does
This bill amends the Fair Labor Standards Act of 1938 (FLSA) to allow private sector employees to choose compensatory time off instead of monetary overtime pay for hours worked beyond 40 in a week. It sets conditions for these agreements, limits on accrued time, and establishes protections against employer coercion, along with remedies for violations.
Proponents argue
Proponents argue that this bill provides much-needed flexibility for working families, allowing employees to choose time off for family needs, personal appointments, or extended vacations instead of immediate cash payment for overtime. They contend it empowers workers with more control over their schedules and work-life balance, similar to options already available to public sector employees.
Opponents contend
Opponents contend that despite the bill's safeguards, it could lead to employer coercion, where employees feel pressured to accept compensatory time instead of monetary overtime, potentially undermining the intent of FLSA and reducing workers' immediate take-home pay. Concerns also exist that employers might deny requests to use accrued time off, making the benefit less valuable than cash.
The bill is relatively short and clearly structured, making it accessible for an informed reader to understand its core provisions within a reasonable timeframe.
Section 2, amending FLSA Section 7(t)(1)
Private Sector Compensatory Time Authorization
This provision allows private sector employees, for a 5-year period, to receive one and one-half hours of compensatory time off for each hour of overtime worked, in lieu of monetary overtime compensation. To be eligible, an employee must not be a public agency employee and must have worked at least 1,000 hours for their employer in a continuous 12-month period.
Supporters argue
Supporters argue this provision offers employees greater flexibility to manage work-life balance, allowing them to bank hours for future use for personal or family needs, rather than being limited to immediate cash payment.
Critics contend
Critics contend that this provision, despite its intent, could lead to employers pressuring employees to choose comp time over cash, potentially reducing immediate earnings and undermining overtime protections designed to ensure fair compensation.
Tradeoffs
This provision balances the desire to provide employees with greater flexibility in compensation choices against concerns that such flexibility could be exploited, leading to a reduction in immediate income for workers.
Section 2, amending FLSA Section 7(t)(2)
Conditions for Compensatory Time Agreements
This section specifies that compensatory time can only be provided if it is in accordance with an applicable collective bargaining agreement. For non-unionized employees, it requires a voluntary, written, or otherwise verifiable agreement between the employer and employee, entered into before the overtime work is performed, and explicitly not as a condition of employment.
Section 2, amending FLSA Section 7(t)(3)
Compensatory Time Accrual Limits and Payout Rules
This provision caps the maximum accrued compensatory time at 160 hours. It mandates that employers must provide monetary compensation for any unused compensatory time accrued during a calendar year or other 12-month period within 31 days after that period ends. Employers can also pay out time exceeding 80 hours with 30 days' notice, and employees can request payout of all unused time at any time, which must be provided within 30 days.
Section 2, amending FLSA Section 7(t)(4)
Anti-Coercion Protections
This provision explicitly prohibits employers from directly or indirectly intimidating, threatening, or coercing, or attempting to intimidate, threaten, or coerce any employee. This applies to the employee's right to request or not request compensatory time off in lieu of monetary overtime compensation, or to requiring any employee to use such compensatory time.
Section 2, amending FLSA Section 7(t)(5) and (6)
Payout Upon Termination and Compensation Rate
This provision mandates that upon voluntary or involuntary termination of employment, an employee with accrued compensatory time must be paid for all unused time. The compensation rate must be the higher of the regular rate received when the compensatory time was earned or the final regular rate received by the employee. Any payment owed for unused compensatory time is considered unpaid overtime compensation.
Section 2, amending FLSA Section 7(t)(7)
Employee Request for Time Off
This provision states that an employee who has accrued compensatory time off and requests its use shall be permitted by their employer to use such time within a reasonable period after making the request, provided that the use of the compensatory time does not 'unduly disrupt the operations of the employer.'
Section 3, amending FLSA Section 16(f)
Penalties for Coercion Violations
This provision establishes specific remedies for employers who violate the anti-coercion provision (Section 7(t)(4)). An employer found in violation is liable to the affected employee for the rate of compensation for each hour of accrued compensatory time, plus an additional equal amount as liquidated damages, reduced by any compensatory time already used by the employee.
The authorization for private sector compensatory time is limited to a 5-year period beginning on the date of enactment of the Working Families Flexibility Act of 2025.
Section 2, amending FLSA Section 7(t)(1)(A)
Why it matters:This could be standard legislative practice for pilot programs or a compromise to gain initial support by limiting the duration of a new policy, allowing for re-evaluation before potential reauthorization or permanent enactment.
Case for: Supporters argue that the 5-year sunset clause allows Congress to evaluate the program's effectiveness, gather data from the GAO reports, and address any unintended consequences before making the policy permanent, providing a responsible trial period.
Case against: Critics might argue that a time-limited authorization creates uncertainty for both employers and employees about the long-term availability of compensatory time, potentially limiting its widespread adoption or effectiveness as a stable benefit.
Estimated impact: Limits the duration of the policy, requiring future legislative action for its continuation or modification after five years.
An employee is only eligible to receive compensatory time off if they have worked at least 1,000 hours for their employer during a period of continuous employment with that employer in the 12-month period ending on the date the agreement is entered into or the date of receipt of compensatory time off.
Section 2, amending FLSA Section 7(t)(1)(B)(ii)
Why it matters:This is standard practice for defining eligibility criteria in legislation, often placed within definitions to ensure precision. It is likely intended to ensure that the compensatory time option is primarily available to established employees rather than very new or transient workers.
Case for: Proponents argue this threshold ensures that the compensatory time option is available to established, committed employees, preventing its use by very short-term or seasonal workers and simplifying administrative burdens for employers regarding new hires.
Case against: Opponents might argue that this provision excludes newer employees or those with less stable employment patterns from accessing this flexibility, potentially disadvantaging a segment of the workforce who might also benefit from time off options.
Estimated impact: Limits the pool of eligible employees, particularly affecting those in their first year of employment or with irregular work histories, by excluding them from participating in the compensatory time program.