Q&A: Which employees should be paid overtime

Q: Which employees should be paid overtime, and what are some basic rules to go by?

A: The Fair Labor Standards Act (FLSA) states that nonexempt employees must be paid time and one-half their regular rate of pay for all hours worked over 40 in a seven-day workweek. Nonexempt employees are defined under the FLSA, and appropriate classification of employees is critical. In accordance with the FLSA, overtime pay may not be calculated over a two-week pay period to allow for more flexible scheduling.

While many employers require that their employees have overtime approved prior to actually working it, if an employee does not receive prior approval, the employer is still required to pay the overtime. The employer may choose to discipline the employee for not following the correct procedure, but the overtime hours must be paid.

Example: John works full time at Pet Mania and his hourly rate of pay is $8.75. Someone calls in sick on John’s day off, so he works an extra eight hours. For the week, John will be paid for his regular hours (8.75 x 40) as well as for the extra hours he put in (8.75 x 1.5 x 8). Therefore, rather than receiving $350 of pre-tax income for the week, John will receive $455 of pre-tax income because of his overtime pay.

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The information provided is for informational purposes only and does not constitute legal advice. The information above contains only a summary of the applicable legal provisions and does not purport to cover every aspect of any particular law, regulation or requirement. Depending on the specific facts of any situation, there may be additional or different requirements. This is to be used only as a guide and not as a definitive description of your compliance obligations.