Internal Candidates: Do I Have to Pay for Interview Time?

By Kathryn O'Connor, PHR, SHRM-CP, CCP, GRP, Director, Compensation Services
Published January 8, 2019

Hiring from inside your organization has numerous advantages, including shorter and less costly recruiting and onboarding time, as well as strengthened employee engagement. Thus, it has become increasingly common to encourage internal candidates to apply for your job postings.  

on the clock

Most recruiters like to schedule interviews during traditional work hours, which can cause complications when a candidate already works for you. Not only can this present scheduling difficulties; this also can impact how you pay the employee for the interview time.

If you schedule an interview with an internal candidate outside of typical working hours, the time spent by the internal applicant interviewing for the position is not considered time worked under the Fair Labor Standards Act (FLSA).  For example, if Nancy works from 10am-6pm, asking Nancy to come to work early for a one-hour 9:00 am interview would not result in any extra compensation owed.

Using this same scenario, if Nancy was asked to interview between 2:00-3:00 pm, Nancy would need to be paid for her interview time. This is because the FLSA considers this time a “meeting.” Under section 29 C.F.R. §785.27—Lectures, Meeting, and Training Programs, if any one of the following four criteria are not met, the employer must consider the time spent interviewing the employee as hours worked:

  1. Attendance is voluntary.
  2. The course, lecture, or meeting is not directly related to the employee’s job.
  3. The employee does not perform any productive work during such attendance.
  4. Attendance is outside of the employee’s regular working hours.

Let’s go through these points together:

We can all agree that Nancy’s interview is voluntary because she was not required to apply for an internal posting and interview for the job – she did so voluntarily. We can also agree that the interview is not directly related to Nancy’s current job (more so the job she hopes to obtain). Next, we can assume that Nancy was not asked to perform productive work during her interview.  

However, the fact that Nancy’s interview is conducted during her regular working hours singlehandedly makes the interview paid. This is because all four conditions (above) must be met for the time to be considered unpaid.  

In light of this information, employers are encouraged to be increasingly cautious when scheduling interviews with internal candidates. Having internal interviewing procedures and guidelines can ensure compliance with wage and hour laws.

Members with questions should contact the HR Hotline at hotline@hrsource.org or 800-448-4584. 



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