(a) The term reasonable cost as used in section 3(m) of the Act is hereby determined to be not more than the actual cost to the employer of the board, lodging, or other facilities customarily furnished by him to his employees.
(b) Reasonable cost does not include a profit to the employer or to any affiliated person.
(c) Except whenever any determination made under § 531.4 is applicable, the “reasonable cost” to the employer of furnishing the employee with board, lodging, or other facilities (including housing) is the cost of operation and maintenance including adequate depreciation plus a reasonable allowance (not more than 5
1/2 percent) for interest on the depreciated amount of capital invested by the employer: Provided, That if the total so computed is more than the fair rental value (or the fair price of the commodities or facilities offered for sale), the fair rental value (or the fair price of the commodities or facilities offered for sale) shall be the reasonable cost. The cost of operation and maintenance, the rate of depreciation, and the depreciated amount of capital invested by the employer shall be those arrived at under good accounting practices. As used in this paragraph, the term “good accounting practices” does not include accounting practices which have been rejected by the Internal Revenue Service for tax purposes, and the term “depreciation” includes obsolescence.
(d)(1) The cost of furnishing “facilities” found by the Administrator to be primarily for the benefit or convenience of the employer will not be recognized as reasonable and may not therefore be included in computing wages.
(2) The following is a list of facilities found by the Administrator to be primarily for the benefit of convenience of the employer. The list is intended to be illustrative rather than exclusive: (i) Tools of the trade and other materials and services incidental to carrying on the employer's business; (ii) the cost of any construction by and for the employer; (iii) the cost of uniforms and of their laundering, where the nature of the business requires the employee to wear a uniform.
Notes of Decisions
Cited in
83
cases (
15 in the last 5 years), 1970–2026 · leading case:
Ramos-Barrientos v. Bland, 661 F.3d 587 (11th Cir. 2011).
Ramos-Barrientos v. Bland, 661 F.3d 587 (11th Cir. 2011).
· cites it 6× “See 29 C.F.R. § 531.3 (d)(1). We defer to the Secretary’s interpretation, Auer v.”
Yu G. Ke v. Saigon Grill, Inc., 595 F. Supp. 2d 240 (S.D.N.Y. 2008).
· cites it 3× “By law, an employer may claim a meal credit if it is properly documented.”
Roces v. Reno Hous. Auth., 300 F. Supp. 3d 1172 (D. Nev. 2018).
· cites it 5× “Here, Plaintiffs assert, for various reasons, that RHA is not entitled to claim any offset based on the lodging provided to Plaintiffs, and therefore Plaintiffs must be paid at least minimum wage for all hours worked.”
Victor Rivera v. Peri & Sons Farms, Inc., 735 F.3d 892 (9th Cir. 2013).
· cites it 2× “29 C.F.R. § 531.3 (d)(1). To the extent deductions for items not qualifying as “board, lodging, or other facilities” — such as items primarily benefit-ting the employer — lower an employee’s wages below the minimum wage, they are unlawful.”
Maryam Balbed v. Eden Park Guest House, LLC, 881 F.3d 285 (4th Cir. 2018).
· cites it 4× “The lodging is provided primarily for the benefit of the employee rather than the employer, 29 C.F.R. § 531.3 (d)(1); and 5. The employer maintains accurate records of the costs incurred in furnishing the lodging, 29 C.”
Jorge E. Arriaga v. Florida Pac. Farms, L.L.C., 305 F.3d 1228 (11th Cir. 2002).
· cites it 2× “See 29 C.F.R. § 531.3 (d)(2) (stating that “the cost of uniforms and of their laundering, where the nature of the business requires the employee to wear a uniform,” is an expense primarily for the benefit of the employer).”
Diaz v. Silver Bay Logging, Inc., 55 P.3d 732 (Alaska 2002).
· cites it 9× “" [10] The language of 29 C.F.R. § 531.3 (d)(1) excludes from the definition of "reasonable cost" the cost of furnishing meals and lodging that are primarily for the benefit or convenience of the employer: The cost of furnishing "facilities" found by the Administrator to be…”
Francisco Soler v. G. & U., Inc., & Sec'y, United States Dep't of Labor, 833 F.2d 1104 (2d Cir. 1987).
· cites it 5× “An exception to this presumption, according to the Administrator, would be in special circumstances where the facilities “are found by the Administrator to be primarily for the benefit or convenience of the employer,” under 29 C.F.R. § 531.3 (d)(1). The district court…”
City of Oakland v. Hassey, 163 Cal. App. 4th 1477 (Cal. Ct. App. 2008).
· cites it 3× “§ 203 (m); 29 C.F.R. § 531.3 (d)(1) (2007).) The FLSA defines wages to include the reasonable cost to an employer of furnishing an employee with “board, lodging, or other facilities, if such board, lodging or other facilities are customarily furnished by such employer to his…”
De Luna-Guerrero v. North Carolina Grower's Ass'n, Inc., 338 F. Supp. 2d 649 (E.D.N.C. 2004).
· cites it 2× “” 29 C.F.R. § 531.3 (d)(1). If the costs are determined to be primarily for the benefit of the employer, the defendants should have reimbursed plaintiffs during the first workweek up to the point that the workers received minimum wage in order to bring defendants into compliance…”
Estanislau v. Manchester Developers, LLC, 316 F. Supp. 2d 104 (D. Conn. 2004).
· cites it 6× “1991) (Citing 29 C.F.R. § 531.3 (c), deductions from minimum wage for lodging are limited to the reasonable cost — which cannot include a profit — or the fair rental value, whichever is less).”
— 29 C.F.R. § 531.3(a) — 3 cases
Estanislau v. Manchester Developers, LLC, 316 F. Supp. 2d 104 (D. Conn. 2004).
“1991) (Citing 29 C.F.R. § 531.3 (c), deductions from minimum wage for lodging are limited to the reasonable cost — which cannot include a profit — or the fair rental value, whichever is less).”
Diaz v. Silver Bay Logging, Inc., 55 P.3d 732 (Alaska 2002).
“" [10] The language of 29 C.F.R. § 531.3 (d)(1) excludes from the definition of "reasonable cost" the cost of furnishing meals and lodging that are primarily for the benefit or convenience of the employer: The cost of furnishing "facilities" found by the Administrator to be…”
— 29 C.F.R. § 531.3(b) — 2 cases
Estanislau v. Manchester Developers, LLC, 316 F. Supp. 2d 104 (D. Conn. 2004).
“1991) (Citing 29 C.F.R. § 531.3 (c), deductions from minimum wage for lodging are limited to the reasonable cost — which cannot include a profit — or the fair rental value, whichever is less).”
Diaz v. Silver Bay Logging, Inc., 55 P.3d 732 (Alaska 2002).
“" [10] The language of 29 C.F.R. § 531.3 (d)(1) excludes from the definition of "reasonable cost" the cost of furnishing meals and lodging that are primarily for the benefit or convenience of the employer: The cost of furnishing "facilities" found by the Administrator to be…”
— 29 C.F.R. § 531.3(c) — 2 cases
Estanislau v. Manchester Developers, LLC, 316 F. Supp. 2d 104 (D. Conn. 2004).
“1991) (Citing 29 C.F.R. § 531.3 (c), deductions from minimum wage for lodging are limited to the reasonable cost — which cannot include a profit — or the fair rental value, whichever is less).”
Diaz v. Silver Bay Logging, Inc., 55 P.3d 732 (Alaska 2002).
“" [10] The language of 29 C.F.R. § 531.3 (d)(1) excludes from the definition of "reasonable cost" the cost of furnishing meals and lodging that are primarily for the benefit or convenience of the employer: The cost of furnishing "facilities" found by the Administrator to be…”
— 29 C.F.R. § 531.3(d) — 1 case
— 29 C.F.R. § 531.3(d)(1) — 2 cases
Francisco Soler v. G. & U., Inc., & Sec'y, United States Dep't of Labor, 833 F.2d 1104 (2d Cir. 1987).
“An exception to this presumption, according to the Administrator, would be in special circumstances where the facilities “are found by the Administrator to be primarily for the benefit or convenience of the employer,” under 29 C.F.R. § 531.3 (d)(1). The district court…”
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