Overtime Law & Definitions FAQs
What is the FLSA?
The Fair Labor Standards Act “FLSA” is a broad federal labor law that dates back to the Roosevelt Administration. It established the minimum wage regulations, child labor standards, record-keeping requirements, and overtime pay requirements which dictate that most employees must be paid time and a half for all “hours worked” after 40 per week.
What is ‘work’?
“Work” under the FLSA includes nearly all time spent performing job-related activities. These can include activities performed while “off-the-clock”, at the job site or elsewhere, whether voluntary or not. Work can include “off-the-clock” time spent maintaining equipment, cleaning up, staying late after normal shifts without “putting in” for overtime, doing job-related paperwork at home, making and responding to job-related telephone calls, working through meals, and many other activities.
What is ‘overtime’?
The word “overtime” is defined under the FLSA, and, in most cases, means all time worked in excess of 40 hours per workweek.
What is a ‘workweek’?
The term “workweek” means a period of 168 hours during 7 consecutive 24-hour periods – a 7 consecutive day period. A workweek can begin on any day of the week chosen by the employer, and each workweek stands alone; therefore, an employer cannot average work hours over 2 or more workweeks when calculating overtime. In other words, an employer cannot only pay overtime if the employee works over 80 hours in a 2-week pay period. If an employee works more than 40 hours in any 1 workweek, regardless of how many hours were worked in the prior or following workweek, they are entitled to overtime pay for those hours. For example, if an employee works 45 hours one week and 30 hours the next, the employee is entitled to 5 hours of overtime pay for the first week, even though their total hours for the 2-week period is under 80 hours.
What is the FLSA overtime rate?
Time and one-half the “regular hourly rate.” If an employee’s regular pay is not expressed as an “hourly” rate, their regular pay rate must be converted to an hourly equivalent. See more details here.
In no case may the regular rate be less than the minimum wage required by FLSA.
If a salary is paid on other than a weekly basis, the weekly pay must be determined in order to compute the regular rate and overtime pay. 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 equivalent. A monthly salary should be multiplied by 12 and the product divided by 52.
What is the difference between Exempt and Non-Exempt employees?
An exempt employee does not have to be paid overtime pay and possibly minimum wage. The Fair Labor Standards Act has numerous exemptions written into the law that exempt certain job positions from either getting overtime pay or being paid minimum wage or both. Each exemption has certain criteria that the position must meet for the exemption to apply. Typically, these are specific job duties. However, some exemptions also have pay requirements. For example, the most common exemptions are the Executive, Administrative, and Professional exemptions which require specific job duties and, in most cases, that the employee be paid on a salary basis.
A non-exempt employee means no overtime or minimum wage exemption applies to the position so the employee must be paid at least minimum wage and time and a half after 40 hours per week.
What is the new minimum wage rate and when did it go into effect?
Workers who are covered by the FLSA are entitled to a minimum wage of not less than $7.25 per hour effective July 24, 2009. Prior to July 24, 2009, the minimum wage rate was $6.55 per hour.
Be aware that many states have higher minimum wage requirements. If your state has a higher minimum wage, your employer must pay the higher amount.