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S. 1158Senate119th Congress (2025-2027)In Committee

Working Families Flexibility Act of 2025

Sponsored by Mike LeeSen. Mike Lee (R-UT)
Introduced March 26, 2025

AI-Generated Summary

Updated November 24, 2025 at 1:40 AM UTC

The Working Families Flexibility Act of 2025 amends the Fair Labor Standards Act to let private‑sector workers receive compensatory time off instead of overtime pay, subject to specific agreements and limits. It sets rules for how the time is earned, recorded, capped, and converted to cash, and adds protections against employer coercion. The bill also creates enforcement penalties, requires updated employee notices, and mandates periodic reporting, with the whole program set to sunset after five years.

Key Provisions

  • Private‑sector employees may earn compensatory time off instead of overtime pay at a rate of at least 1.5 hours of leave for each overtime hour worked.
  • Compensatory time can be offered only through a collective‑bargaining agreement or a written, voluntary agreement with the employee that is recorded and not made a condition of employment.
  • Employees must have worked at least 1,000 hours for the same employer in the 12 months before the agreement or before receiving the time off.
  • An employee can accrue no more than 160 hours of compensatory time. Unused time must be paid out by Jan. 31 each year (or within 31 days after a chosen 12‑month period).
  • Any accrued time over 80 hours can be paid out at any time after the employer gives the employee 30 days’ notice.
  • Employers may end a compensatory‑time policy with 30 days’ notice, and employees can withdraw their agreement or request cash payment for all accrued time at any time.
  • Employers may not intimidate or force employees to accept or use compensatory time, and must pay out all unused time when employment ends.
  • Cash payments must be at the employee’s regular rate (or final rate, whichever is higher) and count as unpaid overtime.
  • Violations of the anti‑coercion rule expose the employer to liquidated damages equal to the overtime rate for each hour of accrued time.
  • The Secretary of Labor must update employee notices about the FLSA, and the GAO must report on the use and enforcement of compensatory time for the next several years.

Legislative Activity

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SenateIntro Referral Latest Action

Read twice and referred to the Committee on Health, Education, Labor, and Pensions.

Health, Education, Labor, and Pensions Committee

March 26, 2025

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SenateIntro Referral

Introduced in Senate

March 26, 2025

SenateIntro Referral

Read twice and referred to the Committee on Health, Education, Labor, and Pensions.

Health, Education, Labor, and Pensions Committee

March 26, 2025

Bill Text

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Introduced in SenateIssued March 26, 2025

II

119th CONGRESS

1st Session

S. 1158

IN THE SENATE OF THE UNITED STATES

March 26, 2025

Mr. Lee (for himself, Mr. Lankford, Mr. Cramer, Mrs. Capito, and Mrs. Blackburn) introduced the following bill; which was read twice and referred to the Committee on Health, Education, Labor, and Pensions

A BILL

To amend the Fair Labor Standards Act of 1938 to provide compensatory time for employees in the private sector.

1.

Short title

This Act may be cited as the Working Families Flexibility Act of 2025.

2.

Compensatory time

Section 7 of the Fair Labor Standards Act of 1938 (29 U.S.C. 207) is amended by inserting after subsection (q) the following:

(r)

Compensatory time off for private employees

(1)

General rule

An employee may receive, in accordance with this subsection and in lieu of monetary overtime compensation, compensatory time off at a rate not less than one and one-half hours for each hour of employment for which overtime compensation is required by this section.

(2)

Conditions

An employer may provide compensatory time to employees under paragraph (1) only if such time is provided in accordance with—

(A)

applicable provisions of a collective bargaining agreement between the employer and the labor organization that has been certified or recognized as the representative of the employees under applicable law; or

(B)

in the case of employees who are not represented by a labor organization that has been certified or recognized as the representative of such employees under applicable law, an agreement arrived at between the employer and employee before the performance of the work and affirmed by a written or otherwise verifiable record maintained in accordance with section 11(c)—

(i)

in which the employer has offered and the employee has chosen to receive compensatory time in lieu of monetary overtime compensation; and

(ii)

entered into knowingly and voluntarily by such employees and not as a condition of employment.

No employee may receive or agree to receive compensatory time off under this subsection unless the employee has worked at least 1,000 hours for the employee’s employer during a period of continuous employment with the employer in the 12-month period before the date of agreement or receipt of compensatory time off.
(3)

Hour limit

(A)

Maximum hours

An employee may accrue not more than 160 hours of compensatory time.

(B)

Compensation date

Not later than January 31 of each calendar year, the employee’s employer shall provide monetary compensation for any unused compensatory time off accrued during the preceding calendar year that was not used prior to December 31 of the preceding year at the rate prescribed by paragraph (6). An employer may designate and communicate to the employer’s employees a 12-month period other than the calendar year, in which case such compensation shall be provided not later than 31 days after the end of such 12-month period.

(C)

Excess of 80 hours

The employer may provide monetary compensation for an employee’s unused compensatory time in excess of 80 hours at any time after giving the employee at least 30 days notice. Such compensation shall be provided at the rate prescribed by paragraph (6).

(D)

Policy

Except where a collective bargaining agreement provides otherwise, an employer that has adopted a policy offering compensatory time to employees may discontinue such policy upon giving employees 30 days notice.

(E)

Written request

An employee may withdraw an agreement described in paragraph (2)(B) at any time. An employee may also request in writing that monetary compensation be provided, at any time, for all compensatory time accrued that has not yet been used. Within 30 days of receiving the written request, the employer shall provide the employee the monetary compensation due in accordance with paragraph (6).

(4)

Private employer actions

An employer that provides compensatory time under paragraph (1) to employees shall not directly or indirectly intimidate, threaten, or coerce or attempt to intimidate, threaten, or coerce any employee for the purpose of—

(A)

interfering with such employee’s rights under this subsection to request or not request compensatory time off in lieu of payment of monetary overtime compensation for overtime hours; or

(B)

requiring any employee to use such compensatory time.

(5)

Termination of employment

An employee who has accrued compensatory time off authorized to be provided under paragraph (1) shall, upon the voluntary or involuntary termination of employment, be paid for the unused compensatory time in accordance with paragraph (6).

(6)

Rate of compensation

(A)

General rule

If compensation is to be paid to an employee for accrued compensatory time off, such compensation shall be paid at a rate of compensation not less than—

(i)

the regular rate received by such employee when the compensatory time was earned; or

(ii)

the final regular rate received by such employee,

whichever is higher.
(B)

Consideration of payment

Any payment owed to an employee under this subsection for unused compensatory time shall be considered unpaid overtime compensation.

(7)

Use of time

An employee—

(A)

who has accrued compensatory time off authorized to be provided under paragraph (1); and

(B)

who has requested the use of such compensatory time,

shall be permitted by the employee’s employer to use such time within a reasonable period after making the request if the use of the compensatory time does not unduly disrupt the operations of the employer.
(8)

Definitions

For purposes of this subsection—

(A)

the term employee does not include an employee of a public agency; and

(B)

the terms overtime compensation, compensatory time, and compensatory time off shall have the meanings given such terms by subsection (o)(7).

.

3.

Remedies

Section 16 of the Fair Labor Standards Act of 1938 (29 U.S.C. 216) is amended—

(1)

in subsection (b), in the first sentence, by striking (b) Any employer and inserting (b) Except as provided in subsection (f), any employer; and

(2)

by adding at the end the following:

(f)

An employer that violates section 7(r)(4) shall be liable to the employee affected in the amount of the rate of compensation (determined in accordance with section 7(r)(6)(A)) for each hour of compensatory time accrued by the employee and in an additional equal amount as liquidated damages reduced by the amount of such rate of compensation for each hour of compensatory time used by such employee.

.

4.

Notice to employees

Not later than 30 days after the date of enactment of this Act, the Secretary of Labor shall revise the materials the Secretary provides, under regulations published in section 516.4 of title 29, Code of Federal Regulations (or any corresponding similar regulation or ruling), to employers for purposes of a notice explaining the Fair Labor Standards Act of 1938 (29 U.S.C. 201 et seq.) to employees so that such notice reflects the amendments made to such Act by this Act.

5.

GAO report

Beginning 2 years after the date of enactment of this Act and each of the 3 years thereafter, the Comptroller General shall submit a report to Congress providing, with respect to the reporting period immediately prior to each such report—

(1)

data concerning the extent to which employers provide compensatory time pursuant to section 7(r) of the Fair Labor Standards Act of 1938, as added by this Act, and the extent to which employees opt to receive compensatory time;

(2)

the number of complaints alleging a violation of such section filed by any employee with the Secretary of Labor;

(3)

the number of enforcement actions commenced by the Secretary or commenced by the Secretary on behalf of any employee for alleged violations of such section;

(4)

the disposition or status of such complaints and actions described in paragraphs (2) and (3); and

(5)

an account of any unpaid wages, damages, penalties, injunctive relief, or other remedies obtained or sought by the Secretary in connection with such actions described in paragraph (3).

6.

Sunset

This Act and the amendments made by this Act shall expire 5 years after the date of enactment of this Act.