HR Management··3 min read

Know Your Overtime Rights: Critical Tips for HR Managers and Employees

Know Your Overtime Rights: Critical Tips for HR Managers and Employees

Overtime can be a blessing and a curse. To employees, it means a sweet bump in pay rate. To employers it means potentially wasted dollars. In a previous post we discussed when employers should pay salary vs. hourly rates, and thus the difference between exempt and nonexempt employees based on rules set by the Department of Labor. In this article we’ll focus on nonexempt employees and what US law has to say about paying for work outside the 40 hour week. Here are seven critical points to help both employers and employees know their rights and get the most out of overtime work.

Who is eligible for overtime pay?

The very first question for an employee to ask is, Am I even eligible for overtime pay? According to the Fair Labor Standards Act (FLSA), only nonexempt employees are eligible for overtime pay. In a nutshell, this means an employee paid less than $23,600 per year ($455 per week) and whose primary job role is not executive, professional, or administrative. If the pay threshold is broken, or if the employee holds a largely white collar position, then the employee is exempt, should be paid on a salary basis, and is not eligible for overtime pay.

Measuring the work week

For shift work and other jobs with irregular hours, measuring the work week can be confusing. By convention most of us consider that a week runs Monday to Sunday. However, according to FLSA rules, businesses can define the work week as any period of 168 consecutive hours, as long as that period is fixed and regular. That means the work week could start at 3 am on a Wednesday if the company so chooses. Working more than 40 hours within the following 168-hour period would trigger overtime payment.

Comp time instead of overtime pay

Granting comp time to employees instead of overtime may seem like a win-win solution for employers and employees who value their time above money. However, it’s not exactly legal for nonexempt employees. According to the FLSA, employees who are eligible for overtime pay are not eligible for comp time.

Working weekends and holidays = overtime pay, right?

There is no federal rule that says employers must pay overtime for work on weekends or holidays. As long as the day falls within the fixed work week and the employee doesn’t exceed 40 work hours for the week, the employer is not obliged to pay overtime. Rules about weekend and holiday pay do vary on the state level, though.

Time and a half vs. double time pay

Some companies offer double time pay when employees work holidays or in excess of 12 hours in a single day. However, there is nothing in the FLSA that obliges them to do so. Some state laws do have stipulation for when double time pay is required, but most do not. More often, double time pay is simply an incentive offered by the company to work additional hours.

Timesheet rounding

Yes, timesheet rounding is legal. Companies with time tracking systems in place are unlikely to engage in timesheet rounding. Rather, the practice is most common in situations where rounding adds convenience to payroll calculation based on employee timesheets. According to the Department of Labor, employers can round work time to the nearest 15 minutes. However, it’s critical that timesheet rounding does not consistently benefit employer at the employee’s expense. There is courtroom precedent for employees winning lawsuits against employers found to round time to their own benefit.

Working through lunch breaks and rest breaks

Unless a company offers paid lunch hours, employees can in fact run into overtime by working through a lunch break. On the other hand, employees who decide not to take rest breaks aren’t racking up extra work hours. According to the FLSA, breaks less than 20 minutes must be paid. Employers need not pay for a break only if it more than 20 minutes (or 30 minutes for a lunch break), the employee is free to leave and do other things, and the employee is completely relieved from work responsibilities.

If you found this post useful #share it:

You may also like to read these.

Explore the extensive resources compiled by experts in the field.

We've got more awesome content!

See all posts

Focus on the fun parts of work!

Let Unrubble handle all your boring stuff.

Automate work schedule planning, work time tracking, pto management, and much more.

Start unrubbling for free
Unrubble's happy user

This website uses cookies, pixel tags, and local storage for performance, personalization, and marketing purposes. We use our own cookies and some from third parties. Only essential cookies are turned on by default.