Overview: Overtime laws are simple, right? When employees work more than 40 hours in a week, you pay them one and a half times their regular rate of pay, right? An employee who earns $10 an hour must be paid $15 an hour for every hour after 40, right?
While that general rule holds true in most cases, there are many variations that can complicate matters quickly. For example, what if an employee receives a bonus or a commission? In some cases, those payments must be factored in to the regular rate of pay. Or, what if an employee performs different jobs at different rates of pay for the same employer?
Also, not all employees need to be paid overtime on the basis of a 40-hour workweek. Certain unionized employees, medical care providers, police and firefighters can be paid according to alternative work periods as long as 28 days.
In addition, overtime laws vary among the states so it's critical that an employer follow state law when calculating employee overtime.
Trends: Employees continue to file, and win, lawsuits seeking unpaid overtime at a rapid pace. At the same time, the federal government and state labor agencies are enforcing overtime laws more aggressively than ever. There appears to be no end in sight to this trend, and employers should remain vigilant in complying with overtime laws.
Author: Michael Cardman, Legal Editor
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Use this workflow to determine how much overtime an employee is owed.
XpertHR's innovative Liveflo Tool now includes a workflow to help an employer determine how much overtime an employee is owed.
Effective January 1, 2016, members of a bargaining unit recognized by the Illinois Labor Relations Board whose union has contractually agreed to a 1040/2080 alternate shift schedule will be exempt from the state's overtime requirements.
This section helps HR professionals manage challenges that come with operating in multiple states, notably complying with differing state and key municipal laws, and addresses the pros and cons of having a centralized or decentralized HR department. Trends currently affecting multistate employers are identified, such as same-sex marriage laws and tracking various state leave laws, are discussed.
An employer may use this policy to ensure they will meet the requirements of the "safe harbor" provision of the Fair Labor Standards Act (FLSA). Under the "safe harbor" provision, employers that inadvertently make improper deductions from the pay of exempt employees can shield themselves from overtime liability if they adopt a salary basis policy and take other steps.
Employment glossary definition of Salary Basis Test.
California employers that must comply with the Fair Labor Standards Act (FLSA) and seek to address the circumstances under which employees classified by the employer as nonexempt will receive the overtime premium should consider including this model policy statement in their handbook.
Colorado employers in the retail and service, commercial support service, food and beverage or health and medical industries seeking to educate employees, including supervisors, about when employees may be entitled to premium pay for overtime in accordance with the Colorado Minimum Wage Order 30 should consider including this model policy statement in their handbook.
HR guidance on complying with federal and state employee overtime laws. Support on following rules and regulations regarding this employment law topic.