Year End Payroll Planning Tip #7: Overtime Pay Guidance

As we enter the holiday season and many companies will be extending their hours, there are many legalities and rules to be aware of.

The FLSA establishes minimum wage, overtime pay, equal pay and recordkeeping requirements for employees who are not exempt from the Act. Generally, non-exempt employees who work for a single employer are entitled to overtime pay of one and one-half times their regular rate of pay for all hours worked over 40 in a workweek. Where a non-exempt employee works for two or more separate employers during the course of a workweek, and thereby works more than 40 hours on a combined basis, the employee is not entitled to overtime pay under the FLSA if the employee works less than 40 hours for any single employer.

On the other hand, work performed for multiple corporate entities can be combined for purposes of determining overtime pay obligations under two scenarios. In one situation, if an employee is employed by two or more “joint” employers during a workweek, all the employment during the week is considered one employment period and all joint employers involved are jointly and severally responsible for compliance with the FLSA’s wage and hour provisions for that work week. In fulfilling their joint obligations, each employer may take credit for all payments made to the employee by the other joint employer. In the second situation, multiple business entities that are deemed to comprise a “single enterprise” also may be liable for overtime pay based on the combined hours worked by employees who are “shared” among the business entities comprising the enterprise.

As you can see from the common situation above, overtime can be quite complex.  There are many other items to consider. Please visit our webpage for a more complete breakdown of your reporting requirements and calculations.

Rest assured that ConnectPay can help answer any of your payroll related questions, from the mundane to the complex.  As the best time of year to consider switching payroll providers, schedule your FREE review of your company policies and procedures now.

Mitchell Zucker 

 CP Logo Final 1-2012




2352 Main Street, Suite 303
Concord, Ma 01742
978-450-2900 voice
978-319-4104 fax
774-218-9486 mobile

Like us on FaceBook:

Leave a Reply