Overtime pay at a rate not less than one and one-half times the regular rate of pay is required after 40 hours of work in a given workweek. The Act applies on a workweek basis. An employee’s workweek is a fixed and regularly recurring period of 168 hours — seven consecutive 24-hour periods. The relevant language from the FLSA is: 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 pay day for the pay period in which the wages were earned.
Best practices tip: Remember that overtime must be calculated every week, even if paying employees on a bi-weekly basis.
Who is covered?
Covered nonexempt employees must receive overtime pay for hours worked over 40 per workweek (any fixed and regularly recurring period of 168 hours — seven consecutive 24-hour periods) at a rate not less than one and one-half times the regular rate of pay.
Since 1940, the Department’s regulations have generally required each of three tests to be met for the FLSA’s EAP (Executive, Administrative, and Professional) exemption to apply:
1. The employee must be paid a predetermined and fixed salary that is not subject to reduction because of variations in the quality or quantity of work performed (“salary basis test”);
2. The amount of salary paid must meet a minimum specified amount (“salary level test”);
3. The employee’s job duties must primarily involve executive, administrative, or professional duties as defined by the regulations (“duties test”).
Best practices tip: It is critical that you identify who in your company is exempt vs. non exempt from overtime.
Because state rules often differ from federal rules. Check your states rules. Here’s the rules for Massachusetts.
Is there a maximum number of overtime hours someone can work?
According to the Fair Labor Standards Act, “There is no limit on the number of hours employees 16 years or older may work in any workweek. The FLSA does not require overtime pay for work on weekends, holidays, or regular days of rest, unless overtime is worked on such days.” Here’s the full text.
Best practices tip: Massachusetts rules differ as it relates to overtime pay on weekends and does require some retailers to pay premium pay for Sundays and certain holidays. We still have “Blue Laws” here in Massachusetts.
Hassle Free Reviews of YOUR payroll workflows
It is our policy to help our clients and prospects to review ALL of their processes and systems for payroll with an eye towards implementing best practices and making sure that all relevant laws are being followed.
Contact us for YOUR free review
2352 Main Street Suite 303
Concord, Massachusetts 01742
14950 East Jefferson Suite 100
Grosse Pointe, Michigan 48230