Employees are due overtime pay for working more than 40 hours per week in most situations. Federal law and some state laws require this. This web page has been created to help victims working for companies not paying overtime when they should. Overtime generally means earning additional pay for time worked after the employee ends a regular workday, usually an eight-hour day. If you work overtime, your employer must do two things:
- Keep detailed time records, and
- Pay at least one and a half times your regular pay rate.
To determine if you are entitled to overtime pay, you should make sure you are not exempt. The Fair Labor Standards Act (FLSA) requires employers to pay minimum wage and overtime. Employers must follow the act unless an exemption applies. The FLSA only applies if there is an employment relationship. Special rules apply for many different situations. Unfortunately, some employers take advantage of the many different laws, paying employees less than what is required.
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What if you are Owed Overtime
IMPORTANT: Any lawsuit must be filed within 2 years to recover back pay.
When employers do not pay for overtime, employees can bring a lawsuit to recover back wages that they are entitled to. Recovery could include liquidated damages and attorney’s fees.
How do you recover back wages owed to you?
There are several ways that an employee can go about recovering unpaid minimum and/or overtime wages. These include:
- Filing a private lawsuit for back pay, including an equal amount as liquidated damages, plus attorney’s fees and court costs
- Through the supervision of government agencies, such as the Wage-Hour Board or the Secretary of Labor
Some common examples of when employers fail to pay overtime are:
- Employers mistakenly treat employees as exempt from overtime pay
- Employers fail to pay overtime to employees who are on salary
- Employers fail to pay for “off the clock” work
- Employers pay for overtime but not the correct amount required by law
- There is an agreement between the employer and the employee that conflicts with the requirements of overtime pay
Almost certainly, “Yes.” BUT there are a number of complicated exceptions within the Fair Labor Standards Act (FLSA) called “exemptions.” Exemptions apply to certain occupations, job duties, and industries.
Even if the company you work for is required by the FLSA to pay overtime or minimum wage, some employees can be exempt from the FLSA, which means that employers do not have to pay either minimum wage, overtime, or both. Because many lawsuits have been filed and disputed over the question of whether or not an exemption applies in a given set of circumstances, we will not list every detail. There can be very strict definitions for each of the exemptions we have listed. Some employers abuse the exemptions by claiming that a particular exemption applies when it does not.
Calculating Overtime Pay
In a lawsuit situation, damages means the total recovery. Total recovery can include back pay due, liquidated damages (double the amount owed), attorney’s fees, and sometimes punitive damages. The time period involved is usually two (2) years prior to filing the lawsuit. The first step is to calculate the difference between what you were paid and what you deserve to be paid.
After the examples below, see definitions of hours worked and workweek. These terms have specific meanings in the context of calculating overtime pay.
How much overtime pay do you deserve?
For each hour worked over 40 hours, pay should equal at least one and a half times the employee’s regular rate of pay. Here are some examples of how to calculate overtime pay based on how you are paid during a 40-hour work week:
- If more than 40 hours are worked, at least one and a half times the regular rate for each hour over 40 is due.
- Example: An employee paid $8.00 an hour works 44 hours in a workweek. The employee is entitled to at least one and a half times $8.00, or $12.00, for each hour over 40. Pay for the week would be $320 for the first 40 hours, plus $48.00 for the four hours of overtime–a total of $368.00.
- The regular rate of pay for an employee paid on a piecework basis is obtained by dividing the total weekly earnings by the total number of hours worked in that week. The employee is entitled to an additional one-half times this regular rate for each hour over 40, plus the full piecework earnings. Another way to pay pieceworkers for overtime, if agreed to before the work is performed, is to pay one and a half times the piece rate for each piece produced during the overtime hours. The piece rate must be actually paid during non-overtime hours and must be more than the minimum wage.
- Generally speaking, salaried employees are not due overtime under the FLSA. However, there are some common employer mistakes which may entitle you to overtime. If you are entitled to overtime, you would calculate the rate of pay by dividing the regular salary by the number of hours for which the salary is intended to pay. If, under an employment agreement, a salary meets the minimum wage requirement in every workweek and is paid as straight time for whatever number of hours are worked in a workweek, the regular rate is obtained by dividing the salary by the number of hours worked each week.
Examples: An employee’s hours of work vary each week and the agreement with the employer is that the employee will be paid $420 a week for whatever number of hours of work are required. Under this agreement, the regular rate will vary in overtime weeks.
- If the employee works 50 hours, the regular rate is $8.40 ($420 divided by 50 hours). In addition to the salary, half the regular rate, or $4.20 is due for each of the 10 overtime hours, for a total of $462 for the week.
- If the salary is for a half month, it must be multiplied by 24 and the product divided by 52 weeks to get the weekly amount. A monthly salary should be multiplied by 12 and the product divided by 52.
Bonus, Productivity Bonus, or Shift Pay
- If you have been paid a bonus based on productivity or some other premium for working a particular shift, depending on the circumstances that additional pay could be included in the calculation of what should be multiplied by “time and a half.”
- Example: An employee makes $12.00 per hour “base pay.” The employee receives a shift pay bonus of $250.00 for the week. The actual rate of pay for overtime calculation pay purposes is $18.25 per hour and not $12.00 per hour. If the employee worked an additional 10 hours, the gross overtime pay due the employee should be $273.75 (10 hours times $18.25 per hour regular pay times “time and a half”) and not $180.00 (10 hours times $12.00 per hour regular pay times “time and a half”).
Overtime does not have to be paid for more than eight (8) spent working in a day, although many employers do this as an incentive. Rather, federal requirements look at an entire work week, usually a fixed period of 168 hours or seven consecutive 24-hour work periods.
Overtime pay is usually 1 ½ the regular rate of pay in effect for that workweek. This is not limited to the standard pay for an employee. Regular rate of pay may include supplemental payments made such as shift pay, bonuses, and commissions. Plus, if the employee worked at several different rates of pay, the different rates of pay should be averaged over the week to determine the actual rate of pay for overtime calculations.
The employer must divide the total earnings for the week by the total hours to find the effective rate of pay and use that amount to calculate the overtime premium rate. Note: Federal regulations can contain special exceptions for certain situations.
|Example:||Total hours worked||56|
|Base pay for first half of week||$15 / hr. for 28 hrs.|
|Base pay for second half of week||$17.50 / hr. for 28 hrs.|
|Subtotal – pay for the week||$1,007.00|
|Regular rate of pay ($1,007.00 divided by 56)||$17.98 / hr.|
|Premium rate (½ regular rate)||$8.99 / hr.|
|Overtime (premium pay x overtime hours)||$143.84|
|Total gross pay (before taxes)||$1,150.84|
The regular rate cannot be less than the minimum wage required by federal law and some state law.
Hours Worked. Covered employees must be paid for all hours worked in a worked. In general, “hours worked” includes all time an employee must be on duty, or on the employer’s premises or at any other prescribed place of work. Also included is any additional time the employee is allowed or permitted work.
Workweek. A workweek is a period of 168 hours during 7 consecutive 24-hour periods. It may begin on any day of the week and at any hour of the day established by the employer. Generally, for purposes of minimum wage and overtime payment each workweek stands alone; there can be no averaging of 2 or more workweeks. Employee coverage, compliance with wage payment requirements, and the application of most exemptions are determined on a workweek basis.
It is against the law to fire or discriminate against an employee for filing a complaint or for participating in a legal proceeding for violation of overtime pay or wage-and-hour requirements. If your employer has done this, she can be held responsible, both civilly and criminally, for those actions.
Common examples of retaliation include:
- Firing the employee for no reason or a fabricated reason
- Refusing a raise regularly given
- Assigning an employee to less desired job duties or shifts
- Reducing job duties
- Blacklisting an employee
- Not hiring an applicant who made an FLSA claim against another company
- Firing a relative of the employee
- Lowering performance reviews
- Disciplining an employee out of proportion to other prior disciplinary practices
Your attorney should be very interested in discussing your employer’s adverse employment action against you as result of asserting your rights. You can sue just for being the victim of such retaliation. You can even receive punitive damages if the retaliation was particularly egregious.
If you are threatened while you are represented by a lawyer, tell your lawyer. There are a number of responses you can discuss. Often, if a lawsuit is pending, an employee’s lawyer can discuss the threat with the company’s lawyers and the threats will usually stop. Most companies do not want to a retaliation lawsuit in addition to the other issues which it may be facing.
Basic Wage Standards
Workers are entitled to a minimum wage of not less than $7.25 an hour. This may vary by state. Wages are due on the regular payday for the pay period covered. Deductions other than taxes from wages cannot be made if employers reduce wages below the minimum wage rate or reduce the amount of overtime pay due.
There are a number of employment practices that federal law does not regulate. These include:
- Vacation, holiday, severance, or sick pay
- Meal or rest periods, holidays off, or vacations
- Overtime pay for weekend, nights or holiday work
- Pay raises or fringe benefits
- Commissions over the standard amount
- A discharge notice, reason for discharge, or immediate payment of final wages to fired employees
- The number of hours in a day or days in a week an employee may be required or scheduled to work, including overtime hours, if the employee is at least 16 years old
Employers are required to keep records on wages, hours, and other items as a regular business practice. Records required for exempt employees are different than records required for nonexempt employees. The following records must be kept by the employer regarding overtime and minimum wage:
- Personal information, including employee’s name, home address, occupation, sex, and birth date if under 19 years of age
- Hour and day when workweek begins
- Total hours worked each workday and each workweek
- Total daily or weekly straight-time earnings
- Regular hourly pay rate for any week when overtime is worked
- Total overtime pay for the workweek
- Deductions from or additions to wages
- Total wages paid each pay period
- Date of payment and pay period covered
Special information is required for:
- Employees working under uncommon pay arrangements
- Employees given room and board
- Employees receiving remedial education
In certain cases, if an employer fails to require and maintain important daily time records, the employer may not be able to dispute an employee’s claim of the number of hours worked, even if the claim is made months later.
Other Anti-Discrimination Laws
Equal Pay. In addition to the FLSA, employers must also comply with other federal laws including equal pay provisions. Equal pay provisions prohibit sex-based wage differences between men and women employed in the same establishment who perform jobs that require equal skill, effort, and responsibility and which are performed under similar working conditions. Unfortunately, the practice of paying women less than men for performing the same job is all too common, even today.
Other labor laws related to wage and hour and overtime laws include the following:
Family and Medical Leave Act entitles eligible employees of covered employers to take up to 12 weeks of unpaid job-protected leave each year, with maintenance of group health insurance, for the birth and care of a child, spouse, or parent placement of a child for adoption of foster case, for the care of a child, spouse, or parent with a serious health condition, or for the employee’s serious health condition.
Wage Garnishment Law limits the amount of an individual’s income that may be legally garnished and prohibits firing an employee whose pay is garnished for payment of a single debt.
Migrant and Seasonal Agricultural Worker Protection Act protects farm workers by imposing certain requirements on agricultural employers and associations and requires the registration of crew leaders who must also provide the same worker protections.
Immigration and Nationality Act requires employers to verify the employment eligibility of individuals hired and keep Immigration and Naturalization forms (I-9) on file for at least 3 years and for one year after an employee is terminated.
Contract Work Hours and Safety Standards Act set overtime standards for service and construction contracts.
Service Contract Act requires payment of prevailing wage rates and fringe benefits on contracts to provide services to the Federal Government.
Walsh-Healey Public Contracts Act requires payment of minimum wage rates and overtime pay on contracts to provide goods to the Federal Government.
Davis-Bacon Act and related acts requires payment of prevailing wage rates and fringe benefits on federally-financed or assisted construction.