If a non-profit provides housing and food during an employee’s 24 hour shift, can it pay a per day stipend or is it required to pay minimum wage?

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If a non-profit provides housing and food during an employee’s 24 hour shift, can it pay a per day stipend or is it required to pay minimum wage?

We are a religious based, non-profit, less than 2 full-time employees and 1 part-time. Currently we are reviewing if we are in compliance with minimum wage laws. Traditionally we provided room and board for the full-time staffer (24 hours – 5 days) and the same for the part-time staffer (24 hours – 3 days) and only paid a per day stipend. We would like to look at other staffing options – 1 full-time day, 1 full-time night and weekend staffer. This would mean that we are providing room and board for 5 nights a week for 1 employee and weekends for the other. Can we still pay a stipend to these 2?

Asked on April 24, 2012 under Employment Labor Law, Michigan

Answers:

FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

The best way to determine whether minimum wages are to be paid to the employees you are writing about with or without a stipend per day in addition to room and board is to have an attorney that practices in the area of employment law draft up an employee contract for the people that work for the non-profit organization that you are writing about to be signed by the employee and the entity's representative.

Depending upon what is agreed to in writing as to stipend or wages and room/board and the scope of the duties of the employee and hours worked should be in compliance with your state's labor laws. It is important to set forth what the per day value of the room and board would be in the suggested written employment agreement.

If the two employees agree to the amount of the stipend in terms of other benefits provided and assuming the total package is greater than the hourly minimum wage in the state that the non-profit is for actual hours worked, the stipend, room, board package signed by the employee should be in compliance with your state's minimum wage laws.


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