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Your Rights Overtime Pay

Outten & Golden LLP

The subject of overtime pay is possibly the most confusing subject for workers seeking to learn more about their employment rights. Many workers do not understand whether or not they are eligible for overtime, or what they should do in the event their employer is not paying them accurately (or at all) for the extra time that they work. Complicating an already difficult subject is the new set of overtime regulations which went into effect in August 2004. (For more information, please see our page on exemptions from overtime.) Many of these regulations are the subject of vastly different interpretations, and have not yet been ruled upon by courts.

On this page, we'll do our best to clarify this complicated subject for you, but if you have remaining questions, you may wish to speak to a local attorney who is knowledgeable about overtime, since it is impossible to anticipate every problem that may have arisen in your workplace.

This page provides answers to the following questions:

1. What is overtime pay?

2. Which federal law(s) cover payment of overtime?

3. Who is covered by overtime laws?

4. Which employers are covered by the law?

5. My employer is covered by the FLSA. Does this mean I am eligible for overtime?

6. I am eligible for overtime, but I am not sure whether my employer is calculating it correctly. How is overtime calculated?

7. How is the 40-hour workweek determined?

8. In exchange for a $2.00 per hour raise, my boss has asked my department not to claim any overtime worked on our pay sheets. Is this legal?

9. My employer pays me a salary, but I think I am eligible for overtime. How do I calculate how much extra overtime pay I should be receiving?

10. Can I get overtime for working on weekends, since I usually work during the week?

11. My employer pays a flat sum for working on Sundays, regardless of how many hours we have already worked that week, or whether working on Sunday would qualify us for overtime pay. Is this considered overtime pay?

12. My employer has offered to give us comp time instead of overtime. I'd much rather have the time off than the additional pay. Is this allowed?

13. After a paid holiday on Monday of this week, I worked four ten-hour days the rest of the week. Am I eligible for overtime?

14. Who enforces the law?

15. What are the remedies available to me?

16. How do I file a complaint/How long do I have to file?

1. What is overtime pay?

It may surprise some to learn that there is no federal law limiting the number of hours that an employee may work in a week, unless the employee is a minor. What keeps employers from requiring employees to work an unlimited amount of hours each week is the requirement that certain workers receive overtime pay. Eligible workers who work more that 40 hours in one week must be paid not less than one and one-half times their regular pay for every hour worked in excess of forty hours. Some states also have overtime pay laws. If both state and federal overtime laws apply, the employee is entitled to whichever overtime protection is most strict and provides the most protection to you as an employee.

2. Which federal law(s) cover payment of overtime?

The federal overtime provisions are contained in the Fair Labor Standards Act (FLSA). Some states also have overtime laws. For more information, see the agency in your state which handles wage and hour/labor standards violations, listed on our site's state government agencies page.

3. Who is covered by overtime laws?

More than eighty million American workers are protected (or "covered") by the FLSA; however, not all of these workers are eligible for overtime. The first step in determining whether you are eligible for overtime is to determine whether your employer is covered by the FLSA. There are two ways in which an employee can be covered: "enterprise coverage" and "individual coverage." Either standard is sufficient for the employer to be subject to the FLSA's overtime provisions.

Enterprise coverage: Employees who work for certain businesses or organizations (or "enterprises") are covered by the FLSA. These enterprises, which must have at least two employees, are:

those which do at least $500,000 a year in business; or

hospitals, businesses providing medical or nursing care for residents, schools and preschools, and government agencies

Individual coverage: Even when there is no enterprise coverage, employees are protected by the FLSA if their work regularly involves them in commerce between states ("interstate commerce"). In its own words, the law covers individual workers who are "engaged in commerce or in the production of goods for commerce."

Examples of employees who are involved in interstate commerce include those who: produce goods (such as a worker assembling components in a factory or a secretary typing letters in an office) that will be sent out of state, regularly make telephone calls to persons located in other States, handle records of interstate transactions, travel to other States on their jobs, and do janitorial work in buildings where goods are produced for shipment outside the State.

Domestic service workers (such as housekeepers, full-time babysitters, chauffeurs and cooks) are normally covered by the law, as long as:

their cash wages from one employer are at least $1,000 in a calendar year (or the amount designated pursuant to an adjustment provision in the Internal Revenue Code), or

they work a total of more than 8 hours a week for one or more employers.

Construction Activities: Employees of construction firms may be subject to the FLSA when they work on certain types of projects. To determine if you are covered in these situations, you must analyze the character of the construction project. The FLSA covers construction work in or on a channel or facility of interstate commerce (i.e. highway, telephone lines, etc). The FLSA also covers construction work which is closely tied with the process of producing goods for interstate commerce, for example, construction which improves, replaces, or expands a covered production facility that ships its products across state lines. Covered construction activity includes:

(1) Repair, maintenance, and construction of instrumentalities of interstate commerce. An instrumentality of interstate commerce includes railroads, highways and city streets, pipe lines, telephone and/or electrical transmission lines, airports, bus/truck/steamship terminals, radio or TV stations and river/streams/waterways over which interstate or foreign commerce regularly moves.

(2) Repair, maintenance, reconstruction, redesign, improvement or extension or enlargement of an existing facility engaged in the production of goods for interstate commerce. The construction of a new production facility would not be a covered project.

An employee working on projects such as these is considered to be essential to interstate commerce or the production of goods for interstate commerce.

4. Which employers are covered by the law?

Employers whose enterprises are covered by the FLSA, or who have employees engaged in interstate commerce are required by the FLSA to pay overtime to eligible employees. Unlike some other laws relating to employment, the standard does not hinge upon how many employees the employer has, but instead looks at the nature of the work performed by the enterprise and the employee to determine whether interstate commerce is involved. For more information, please see the previous question.

5. My employer is covered by the FLSA. Does this mean I am eligible for overtime?

Not necessarily. First, the type of job you do may be one that is specifically excluded from protection under the FLSA or its overtime provisions. Second, if you are paid a salary and perform the duties of an exempt employee, you will not be eligible for overtime. These distinctions are covered on our site's page on exemptions from overtime.

6. I am eligible for overtime, but I am not sure whether my employer is calculating it correctly. How is overtime calculated?

Unless specifically exempted, eligible employees must receive overtime pay for hours worked in excess of 40 in a workweek at a rate not less than time and one-half their regular rates of pay. There is no limit in the FLSA on the number of hours employees aged 16 and older may work in any workweek. The FLSA does not require overtime pay for work on Saturdays, Sundays, holidays, or regular days of rest, as such.

There are some states that require payment for hours worked in excess of eight in one day, but the federal law and the law of most states is based on a 40-hour workweek. For more information on state overtime laws, see the agency in your state which handles wage and hour/labor standards violations, listed on our site's state government agencies page.

7. How is the 40-hour workweek determined?

An employee's workweek is a fixed and regularly recurring period of 168 hours -- seven consecutive 24-hour periods. It does not have to coincide with the calendar week, but may begin on any day and at any hour of the day. Different workweeks may be established for different employees or groups of employees. Averaging of hours over two or more weeks is not permitted. Normally, overtime pay earned in a particular workweek must be paid on the regular pay day for the pay period in which the wages were earned.

While a workweek customarily begins on Monday, that is not a legal requirement. However, an employer must follow a fixed pattern and cannot manipulate the start of the workweek to avoid paying overtime.

8. In exchange for a $2.00 per hour raise, my boss has asked my department not to claim any overtime worked on our pay sheets. Is this legal?

The overtime requirement may not be waived by agreement between the employer and employees. An agreement that only 8 hours a day or only 40 hours a week will be counted as working time also fails to comply with the law. An announcement by the employer that no overtime work will be permitted, or that overtime work will not be paid for unless authorized in advance, also will not impair the employee's right to compensation for compensable overtime hours that are worked.

8. My employer pays me a salary, but I think I am eligible for overtime. How do I calculate how much extra overtime pay I should be receiving?

FLSA overtime is calculated at time and one-half of an employee's "regular rate" of pay. Subject to some special rules, the regular rate is the total non-overtime compensation received by an employee (for work) divided by the number of non-overtime hours these wages are intended to compensate. Most wage "augments" must be included in the regular rate, such as productivity bonuses, longevity pay, or shift differentials.

The regular rate of pay cannot be less than the minimum wage. The regular rate includes all pay for employment except certain payments excluded by the FLSA. Payments which are not part of the regular rate include:

pay for expenses incurred on the employer's behalf,

premium payments for overtime work or the true premiums paid for work on Saturdays, Sundays, and holidays,

discretionary bonuses,

gifts and payments in the nature of gifts on special occasions, and

payments for occasional periods when no work is performed due to vacation, holidays, or illness.

Earnings may be determined on a piece-rate, salary, commission, or some other basis, but in all such cases the overtime pay due must be computed on the basis of the average hourly rate derived from such earnings. This is calculated by dividing the total pay for employment (except for the noted statutory exclusions) in any workweek by the total number of hours actually worked.

For example, you are paid a salary of $400 a week, and typically receive a $120 bonus every 12 weeks as a "productivity bonus," based upon the entire department's efforts and not your individual efforts (so it's not considered a discretionary bonus.) Because your salary is below $455 each week, you are eligible for overtime pay. In a week where you work 50 hours, your pay should be calculated as follows:

Regular rate of pay: $400 (weekly pay) plus $10 (bonus pay per w-eek) equals:

$410 per week or $8.20 per hour worked.

Calculating overtime hours: 10 hours worked times 1.5 (overtime rate) equals:

15 hours, or 5 additional overtime hours

Calculating overtime pay rate: $8.20/hour times .5 (half the regular rate) equals:

$4.10/hour or $20.50 in overtime pay.

Your weekly paycheck should be: $410 regular pay (for 50 hours) plus $20.50 overtime pay (for additional 5 "time-and-a-half" hours):

$430.50

Your employer cannot evade the law by paying you a fixed salary for a regular workweek longer than 40 hours.

For example, an employee may be hired to work a 45 hour workweek for a weekly salary of $300. In this instance the regular rate is obtained by dividing the $300 straight-time salary by 45 hours, resulting in a regular rate of $6.67. The employee is then due additional overtime computed by multiplying the 5 overtime hours by one-half the regular rate of pay ($3.335 x 5 = $16.68).

Where an employee in a single workweek works at two or more different types of work for which different straight-time rates have been established, the regular rate for that week is the weighted average of such rates. That is, the earnings from all such rates are added together and this total is then divided by the total number of hours worked at all jobs.

If non-cash payments are made to employees in the form of goods or facilities, the reasonable cost to the employer or fair value of such goods or facilities must be included in the regular rate.

9. Can I get overtime for working on weekends, since I usually work during the week?

Only if you actually work overtime during that week. The FLSA does not require overtime pay for work on Saturdays, Sundays, holidays, or regular days of rest, unless overtime hours are worked on such days. The FLSA does not require extra pay for weekend or night work or double time pay.

10. My employer pays a flat sum for working on Sundays, regardless of how many hours we have already worked that week, or whether working on Sunday would qualify us for overtime pay. Is this considered overtime pay?

No. A lump sum paid for work performed during overtime hours without regard to the number of overtime hours worked does not qualify as an overtime premium even though the amount of money paid is equal to or greater than the sum owed on a per-hour basis.

For example, no part of a flat sum of $90 to employees who work overtime on Sunday will qualify as an overtime premium, even though the employees' straight-time rate is $6.00 an hour and the employees always work less than 10 hours on Sunday. Similarly, where an agreement provides for 6 hours pay at $9.00 an hour regardless of the time actually spent for work on a job performed during overtime hours, the entire $54.00 must be included in determining the employees' regular rate.

11. My employer has offered to give us comp time instead of overtime. I'd much rather have the time off than the additional pay. Is this allowed?

"Comp time," or compensatory time refers to the practice of allowing an employee to take extra time off from work after a long week, instead of being paid overtime wages. What you may not know, however, that in most situations, the practice is illegal, if you are working for a private, non-governmental employer, and you are a "non-exempt" employee otherwise eligible for overtime pay.

For example, if you work 56 hours in a week and you are told that you can have two eight-hour days off in some other week to offset the extra 16 hours, this is probably a violation of the law. You are supposed to be paid overtime for the 16 hours you worked in the first week.

For more information about comp time, please see our site's comp time page.

12. After a paid holiday on Monday of this week, I worked four ten-hour days the rest of the week. Am I eligible for overtime?

No. An employer is only obligated to pay overtime for hours you actually work, and does not have to count holidays, sick time, vacation time, and any other time for which you are paid but did not work. If your employer has a policy of paying you for holidays, then you will be paid for forty-eight hours of straight time for the week, but will not receive time-and-a-half for eight of those hours, since that was not time actually worked.

13. Who enforces the law?

The FLSA is enforced by the Wage-Hour Division of the U.S. Department of Labor. Wage-Hour's enforcement of FLSA is carried out by investigators stationed across the U.S., who conduct investigations and gather data on wages, hours, and other employment conditions or practices, in order to determine whether an employer has complied with the law. Where violations are found, they also may recommend changes in employment practices to bring an employer into compliance.

It is a violation to fire or in any other manner discriminate against an employee for filing a complaint or for participating in a legal proceeding under FLSA.

Willful violations may be prosecuted criminally and the violator fined up to $10,000. A second conviction may result in imprisonment. Employers who willfully or repeatedly violate the minimum wage requirements are subject to a civil money penalty of up to $1,000 for each such violation.

The FLSA makes it illegal to ship goods in interstate commerce which were produced in violation of the minimum wage, overtime pay, child labor, or special minimum wage provisions.

To contact the Wage-Hour Division for further information and/or to report a potential FLSA minimum wage violation, call:

Toll Free: (866) 4USWAGE (866-487-9243)
TTY: (877) 889-5627 (available Monday-Friday 8 a.m. to 6 p.m. Eastern Time)

You may also contact your local WHD office.

If you need further information about your state's overtime law and/or wish to report a potential state overtime law violation, then you may wish to contact the agency in your state which handles wage and hour/labor standards violations, listed on our site's state government agencies page.

14. What are the remedies available to me?

There are several different methods under the FLSA for an employee to recover unpaid overtime wages; each method has different remedies.

Wage-Hour may supervise payment of back wages.

The Secretary of Labor may bring suit for back wages and an additional penalty, called "liquidated damages," which can be equal to the back pay award (essentially doubling the damages) if an employer willfully violated the statute.

An employee may file a private lawsuit for back pay and an equal amount as liquidated damages, plus attorney's fees and court costs. An employee may not bring a lawsuit if he or she has been paid back wages under the supervision of Wage-Hour or if the Secretary of Labor has already filed suit to recover the wages.

The Secretary of Labor may obtain an injunction to restrain any person from violating FLSA, including the unlawful withholding of proper overtime pay.

Your state overtime law may have different methods for recovery of unpaid wages, and different remedies to be awarded to those who succeed in proving a violation. For further information, please contact the agency in your state which handles wage and hour/labor standards violations, listed on our site's state government agencies page.

15. How do I file a complaint/How long do I have to file?

To file a complaint for unpaid overtime wages under the FLSA, you may either go to the WHD, which may pursue a complaint on your behalf, or file your own lawsuit in court (which may require you to hire an attorney).

Do not delay in contacting the WHD or your state agency to file a claim. There are strict time limits in which charges of unpaid wages must be filed. To preserve your claim under federal law, you must file a lawsuit in court within 2 years of the violation for which you are claiming back wages, except in the case of an employer's willful violation, in which case a 3-year statute applies. However, as you might have other legal claims with shorter deadlines, do not wait to file your claim until your time limit is close to expiring. You may wish to consult with an attorney prior to filing your claim, if possible. Yet if you are unable to find an attorney who will assist you, it is not necessary to have an attorney to file your claim with the state and federal administrative agencies.

Details about how to file a complaint are available at DOL's website at http://www.dol.gov/esa/whd/regs/compliance/fairpay/complaint.htm.

Your state overtime law may have different deadlines for recovery of unpaid wages. For further information, select your state from the map below or from this list.


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This page was updated on February 28, 2012



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