What is overtime? Who is eligible to receive it, and how is it calculated? How do I know if my employees are eligible to receive overtime compensation? Many employers have questions regarding this component of the Fair Labor Standards Act (FLSA) and how to remain compliant when operating a business and properly compensating employees. 

Overtime Explained and Who is Eligible

As of the date this article was published, the U.S. Department of Labor (DOL) Wage and Hour Division (WHD) states, “Unless exempt, employees covered by the FLSA must receive overtime pay for hours worked in excess of 40 in a workweek at a rate not less than one-and-one-half times their regular rates of pay." There is no limit in the FLSA on the number of hours employees aged 16 or older may work in any workweek. The FLSA does not require overtime pay for work on Saturdays, Sundays, holidays, or regular days of rest unless overtime is worked on such days.

The FLSA applies on a workweek basis. An employee's workweek is a fixed and regularly recurring period of 168 hours — seven consecutive 24-hour periods. It need not 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 payday for the pay period in which the wages were earned.

If you're unsure about whether a particular employment situation is covered by the FLSA, you should review the FLSA Coverage and Employment Status Advisor. One particular exemption, FLSA section 13(a)(1), exempts from both minimum wage and overtime pay protections bona fide executive, administrative, professional and outside sales employees. FLSA sections 13(a)(1) and 13(a)(17) also exempt certain employees in computer-related occupations. The FLSA contains several other exemptions from the minimum wage and/or overtime pay protections which are not covered in this article.

Which Employees Are Exempt From Federal Overtime Law

1. Executives, administrators, and outside sales employees, who are paid on a salary basis;
2. Independent contractors;
3. Those who work in a job governed by some other specific federal labor law, such as railroad workers and many truck drivers;
4. Certain computer specialists, such as systems analysts, programmers, and software engineers, who earn at least $27.63 per hour;
5. Volunteer workers (rarely applies to for-profit companies);
6. Employees of organized camps, religious, or nonprofit educational conference centers that operate for fewer than seven months a year;
7. Employees of seasonal amusement or recreational businesses, for example ski resorts or county fairs;
8. Employees of certain small newspapers;
9. Newspaper deliverers;
10. Workers engaged in fishing operations;
11. Seamen on a vessel other than an American vessel;
12. Certain switchboard operators;
13. Employees that work on small farms; or
14. Babysitters.

This is only a partial listing of the exempt employees that are the most common. You can learn more about these exemptions by visiting the DOL website at www.dol.gov.

What is a Nonexempt Employee?

A nonexempt employee is an employee who is “not exempt” from FLSA requirements. These employees are hourly workers who earn at least the federal minimum wage and must be paid time and a half for overtime hours worked. The FLSA provides these regulations to protect employees who are working in the private sector.

You can view our blog article What is a Nonexempt Employee? for more information on this topic.

Overtime Laws and Rules for Each State

The FLSA standards apply to all of the states as bare-minimum requirements, whether they have their own overtime standards or not. Besides the FLSA, some states have their own overtime laws. Some of these states' laws mimic federal law, while others have higher standards. Where the federal and state laws differ, the higher of the two standards applies.

The following is a summary of the states and their overtime law or regulations. Some states may have more exemptions and/or exceptions than what is listed below. As with any legal matter, you should contact your state’s DOL or your company attorney to get the most current and accurate information.

State Overtime Laws Weekly and Daily: 

Alabama

• No overtime provisions.

Alaska

• Time and a half after eight hours per day.
• Time and a half after 40 hours per week.
• Employment overtime laws apply to employers of four or more employees as well as commerce or manufacturing businesses.

Notes: A voluntary flexible work hour plan of 10-hour day, 40-hour weeks with premium pay after 10 hours is permitted.

Arizona

• No overtime limits for private-sector employers.

Arkansas

• Time and a half after 40 hours per week.
• Employment overtime laws apply to employers of four or more employees.

Notes: Employees in retail and service establishments who spend up to 40% of their time on nonexempt work must be paid at least twice the state's minimum wage ($572 per week).

California

• Time and a half after eight hours per day. After 12 hours, employees are due double-time.
• Time and a half after 40 hours per week.  
• On the seventh day of consecutive work: Time and a half for the first eight hours. After eight hours, employees are due double-time.
• Employment excluded from overtime laws: Computer software employees who design, develop, create, analyze, test, or modify programs using independent judgment, or those who are paid at least $45.84 per hour.

Notes: Alternative four 10-hour-day workweeks are permitted if established prior to 7/1/99. Seventh-day premium pay is not required when an employee works no more than 30 hours per week or six hours per day.

Colorado

• Time and a half after 12 hours per day.
• Time and a half after 40 hours per week.
• Employment overtime laws apply to employees in retail and service, commercial support service, food and beverage, and health and medical industries. 

Connecticut

• Time and a half after 40 hours per week
• Premium pay on weekends, holidays, or sixth or seventh consecutive workdays.

Notes: In restaurants and hotels, time-and-a-half pay is required for employees who work seven consecutive days or for hours that exceed 48 per week.

Delaware

• No overtime provisions.
• District of Columbia
• Time and a half after 40 hours per week.

Florida

• No overtime provisions.

Georgia

• No overtime provisions.

Hawaii

• Time and a half after 40 hours per week.
• Dairy, sugar cane, and seasonal agricultural work: 48 hours per week.
• Employment excluded from overtime laws: Employees earning guaranteed compensation of $2,000 or more per month.

Idaho

• No state overtime rules that differ from FLSA.

Illinois

• Time and a half after 40 hours per week.
• Employment overtime laws apply to employers of four or more employees.

Indiana

• Time and a half after 40 hours per week.
• Employment excluded from overtime laws: Employment that is subject to the FLSA, movie theaters, seasonal camps, and amusement parks as well as FLSA-exempt nonprofits.

Notes: Collective bargaining agreements ratified by the NLRB may have different overtime provisions. Domestic service work is not excluded from overtime laws.

Iowa

• No state overtime limits.

Kansas

• Time and a half after 46 hours per week.
• Employment excluded from overtime laws: Employment that is subject to the FLSA.

Kentucky

• Time and a half after 40 hours per week.
• Employment excluded from overtime laws: Retail, hotel, and restaurant businesses.

Notes: Employees working seven days and a row are eligible for time and a half.

Louisiana

• No overtime provisions.

Maine

• Time and a half after 40 hours per week.
• Employment excluded from overtime laws: Auto mechanics, parts clerks, and salespersons; hotels, motels, and restaurants; and those canning, freezing, packing, and shipping produce and perishable foods.

Notes: Employee cannot be required to work more than 80 hours of overtime in any two-week period.

Maryland

• Time and a half after 40 hours per week; 48 hours for bowling alleys and residential employees caring for the sick, aged, or mentally ill in institutions other than hospitals; and 60 hours for agricultural work.

Massachusetts

• Time and a half after 40 hours per week.
• Employment excluded from overtime laws: Agriculture, farming, and fishing; hotels, motels, or restaurants; seasonal workers employed fewer than five months; hospital, nursing home, or rest home employees; and those working in public transit. 

Notes: Time and a half is the rate for overtime unless an employee is already paid that rate as part of his or her regular compensation.

Michigan

• Time and a half after 40 hours per week.
• Employment overtime laws apply to employers of two or more employees.
• Employment excluded from overtime laws: Employees not subject to state minimum wage laws.

Minnesota

• Time and a half after 48 hours per week.

Mississippi

• No overtime provisions.

Missouri

• Time and a half after 40 hours per week and 52 hours for seasonal amusement or recreation businesses.
• Employment excluded from overtime laws: Retail or service businesses with gross annual sales or contracts of less than $500,000.

Montana

• Time and a half after 40 hours per week and 48 hours for students working seasonal jobs at amusement or recreational areas.

Nebraska

• No overtime provisions.

Nevada

• Time and a half after eight hours per day.
• Time and a half after 40 hours per week.
• Employment excluded from overtime laws: Businesses with a gross annual sales volume of less than $250,000.

Notes: An employer and employee may agree to a flex-time schedule of four 10-hour days.

New Hampshire

• Time and a half after 40 hours per week.
• Employment excluded from overtime laws: Employees in amusement, seasonal, or recreational businesses open seven months or fewer a year.

New Jersey

• Time and a half after 40 hours per week.
• Employment excluded from overtime laws: June to September: Summer camps, conferences, and retreats operated by nonprofit or religious groups.

New Mexico

• Time and a half after 40 hours per week.

New York

• Time and a half after 40 hours per week for nonresidential workers and 44 for residential workers.
• Employment excluded from overtime laws: Same exemptions as FLSA.

North Carolina

• Time and a half after 40 hours per Week and 45 hours per week in seasonal amusement or recreational establishments.

North Dakota

• Time and a half after 40 hours per week and 50 hours per week for cab drivers.
• Employment excluded from overtime laws: Computer professionals who design, develop, create, analyze, test, or modify programs using independent judgment, or those who are paid at least $27.63 per hour.

Ohio

• Time and a half after 40 hours per week.
• Employment overtime laws apply to employers who gross more than $297,000 per year.

Oklahoma

• No state overtime provisions.

Oregon

• Time and a half after 40 hours per week.

Notes: Time and a half required after 10 hours per day in canneries, driers, packing plants, mills, factories, and manufacturing facilities.

Pennsylvania

• Time and a half after 40 hours per week.

Rhode Island

• Time and a half after 40 hours per week.

Notes: Time and a half for Sunday and holiday work is required for most retail businesses (these hours are not included when calculating weekly overtime).

South Carolina

• No overtime provisions.

South Dakota

• No overtime provisions.

Tennessee

• No overtime provisions.

Texas

• No overtime provisions.

Utah

• No overtime provisions.

Vermont

• Time and a half after 40 hours per week.
• Employment overtime laws apply to employers of two or more employees.
• Employment excluded from overtime laws: Retail and service businesses if 75% of annual sales are not from resale; hotels, motels, restaurants; and transportation workers exempt under the FLSA.

Virginia

• No overtime provisions.

Washington

• Time and a half after 40 hours per week.

West Virginia

• Time and a half after 40 hours per week.
• Employment overtime laws apply to employers of six or more employees at one location.

Wisconsin 

• Time and a half after 40 hours per week.
• Employment overtime laws apply to manufacturing, mechanical, or retail businesses; beauty parlors, laundries, restaurants, hotels; and telephone, express, shipping, and transportation companies.

Wyoming

• No overtime provisions.

FLSA and Overtime Laws: Important Facts to Remember

• Weighted standards, sometimes referred to blended standards, is when employers must take the average of all pay rates and multiply the average by 1.5 to find overtime rate.
• When looking at both federal and state laws, whichever law will be most beneficial to the employee should be utilized as a standard.
• Number of employees to be applicable? This is dependent on individual state laws but is not to supersede federal law if not beneficial to employees. 

Options to Calculate Overtime

Overtime can be calculated in ways not defined by federal or state laws as long as employers are providing compensation that is meeting at least the minimum requirements for their states. Some additional methods to offer and calculate overtime are:

• Double time; 
• Additional compensation or shift differential for weekend hours;
• Additional compensation or shift differential for night time hours; and
• Overtime compensation calculated for any hours worked over eight hours in a given shift.

While these benefits are not required at a federal level, they serve as an incentive for employees to work additional hours or shifts that they may not otherwise consider.

What Is not Required When Calculating Overtime?

Employers have certain benefits that they may offer to their employees, but that are not required when calculating overtime wages, such as unusual hours, night shift premiums, weekend hours, holidays, paid time off or double time.  While all can be incentives to utilize as part of your employee benefits package, it is not something that is mandated when calculating overtime wages.

Overtime Requirements

While most states look at overtime as any time worked within the parameters set of any time calculated over forty hours per week, your state could have more specific exemptions that need to be considered when determining overtime.  

To obtain additional information regarding the Department of Wage and Labor, as well as the FLSA, visit:  http://www.wagehour.dol.gov or call 866-4USWAGE (866-487-9243).

References:

http://webapps.dol.gov/elaws/elg/minwage.htm

https://www.dol.gov/whd/regs/compliance/hrg.htm#14

https://www.dol.gov/whd/overtime/final2016/

https://webapps.dol.gov/elaws/overtime.htm

https://www.law.cornell.edu/uscode/text/29/213

https://www.employmentlawhandbook.com/federal-employment-and-labor-laws/flsa/exemptions/