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5 Key Facts about Overtime

Under the Federal  Fair Labor Standards Act ( FLSA ) employees are classified as either exempt or non-exempt from overtime. The FLSA requires employers to pay non-exempt employees (referred to as “hourly” employees) overtime if they work more than 40 hours in a workweek.  The OT pay must be one & a half times the employee’s regular rate of pay.  However the FLSA includes exemptions  from OT requirements for certain administrative, professional, executive, highly compensated, outside sales and computer professional employees.  These employees are known as “exempt” employees.  The trouble is some  employers have misconceptions about OT and exemptions. Below is an overview of some of the major FLSA requirements with Overtime:

  1. Compensatory time off (“comp time”) is paid time off that is offered instead of cash payment for working overtime.  However “comp time” is not permissible in the private sector, so private employers can not offer comp time in lieu of Overtime.
  2. The FLSA requires a single workweek when determining if an employee is due OT, irrespective of the employer’s pay cycle.  If you have a bi-weekly pay schedule and an employee works 30 hours in one week and 50 in the second (total 80 hours over 2 weeks) those hours cannot be combined and averaged, the employee is entitled to 10 hours overtime for all hours worked over 40 in the second week.
  3. Rest breaks are considered hours worked and therefore must be paid and included when determining OT.  The DOL defines a rest break as any period lasting 20 minutes or less that the employee is allowed to spend away from work.  Meal periods, on the other hand, aren’t consider hours worked and need not be included when determining whether an employee is due OT as long as the meal period is at least 30 minutes and the employee is fully relieved of all duties for the purpose of eating a regular meal.
  4. If a non-exempt employee has worked OT they must be paid OT regardless of whether the OT was pre-authorized or not.
  5. Under the FLSA, travel that keeps an employee away from home overnight is considered hours worked when it takes place during the employee’s regularly scheduled work hours, regardless of which day of the week the travel occurs.  In addition, travel time for special one day assignments, certain emergency calls, and travel from job site to job site throughout the work day is compensable.  This means that the time must be included when determining whether OT is due.

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