USMCA Paid Meal Time and Paid Break Time

Section 810.115 explains how to treat paid meal and break times when calculating the average hourly base wage rate. Such time counts as direct production work for purposes of determining (under § 810.105(b)(2)(i)) whether at least 85 percent of a worker’s total work hours—a figure that includes paid meal time and paid break time for purposes of the USMCA—are hours worked in direct production. However, if less than 85 percent of a worker’s total work hours are worked in direct production, paid meal time and paid break time are not considered hours worked in direct production when applying § 810.105(b)(2)(ii). Unpaid meal time and unpaid break time are never included in the average hourly base wage rate calculation.

Counting paid meal and break time toward the 85 percent threshold is a fair approach that will simplify the average hourly base wage rate calculation and ease burdens on producers. In contrast, a simple example illustrates how excluding such time from the 85 percent threshold could undermine the threshold and thus the USMCA’s objectives. A full-time worker who works 8 hours per day, 5 days per week, during the producer’s certification period must spend at least 34 hours per week (i.e., 85 percent of 40 hours) performing direct production work to meet the 85 percent threshold. If such a worker received a 30-minute paid meal break and two 15-minute paid rest breaks each work day (totaling 5 hours per week), and such hours did not count toward the 85 percent threshold (but were considered part of total hours worked), the worker would not meet the 85 percent threshold if the worker spent more than 1 additional hour per week performing work that is not direct production work. This outcome could result in more workers who spend virtually all of their time performing direct production work nonetheless not meeting the 85 percent threshold. Such a result could undermine the interests in administrative efficiency underlying the 85 percent threshold, and create disincentives to providing workers paid meal and break times—time which may help to promote worker efficiency. Given such consequences, the Department believes its treatment of paid meal time and paid break time is consistent with the Uniform Regulations.

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