Am I Owed Overtime Pay? Understanding Your Rights Under the Fair Labor Standards Act (FLSA)

Last updated 4 months ago. Our resources are updated regularly but please keep in mind that links, programs, policies, and contact information do change.

What is the FLSA and Overtime Pay?

The Fair Labor Standards Act (FLSA) is a cornerstone of federal labor law enacted in 1938 that establishes critical protections for workers across the United States. Its main goals are to ensure fair labor conditions by setting standards for minimum wage, overtime pay, employer recordkeeping, and child labor. These standards apply to many employees in both the private sector and government jobs at the federal, state, and local levels.

One of the most significant protections under the FLSA is the requirement for overtime pay. For employees who are covered by the Act and not specifically exempt (referred to as “non-exempt” employees), the law generally requires employers to pay them at a rate of at least one and one-half times their regular rate of pay for all hours worked over 40 in a workweek.

The Wage and Hour Division (WHD) of the U.S. Department of Labor (DOL) is the agency responsible for administering and enforcing the FLSA for most employment.

For more detailed information directly from the source, you can visit the Department of Labor’s main FLSA page and their specific page on Overtime Pay.

Who is Covered by the FLSA?

The FLSA’s protections, including minimum wage and overtime pay, apply to employees who are “covered” by the Act. There are two main ways an employee can be covered: “enterprise coverage” and “individual coverage”. If an employee is covered under either type, they are entitled to FLSA protections unless a specific exemption applies.

Enterprise Coverage

This type of coverage applies to all employees working for a covered “enterprise.” An enterprise generally includes businesses or organizations that meet certain criteria. To qualify for enterprise coverage, the business or organization must typically:

• Have at least two employees
• Have an annual gross volume of sales made or business done of at least $500,000

However, certain types of organizations are considered covered enterprises regardless of their annual dollar volume. These “named enterprises” include:

• Hospitals
• Businesses providing medical or nursing care for residents (like nursing homes)
• Schools and preschools (including institutions of higher education)
• Government agencies (federal, state, and local)

The inclusion of these specific entities regardless of their revenue reflects a policy choice to ensure broad FLSA protection for employees in these vital public-interest sectors. If a business or organization qualifies for enterprise coverage, all of its employees are generally covered by the FLSA’s minimum wage and overtime provisions, unless a specific individual exemption applies.

Individual Coverage

Even if your employer does not meet the requirements for enterprise coverage (for example, a small business with less than $500,000 in annual business), you might still be protected by the FLSA under “individual coverage”.

Individual coverage applies if your specific work regularly involves you in “interstate commerce” or in the “production of goods for commerce”. The scope of “interstate commerce” under the FLSA is quite broad and covers many activities that might seem purely local at first glance.

Examples of work that can trigger individual coverage include:

• Regularly making phone calls to people in other states
• Regularly sending or receiving mail or electronic communications (like emails) across state lines
• Handling records of interstate transactions
• Processing credit card transactions involving out-of-state banks or customers
• Ordering or receiving goods from out-of-state suppliers
• Handling, shipping, or receiving goods that are moving in interstate commerce
• Producing goods (like assembling parts in a factory or typing letters in an office) that will be sent out of state
• Regularly crossing state lines as part of your job
• Working in communications or transportation industries
• Performing duties like guarding, janitorial work, or maintenance that are closely related and directly essential to these interstate activities

Because many common job tasks, such as using phones, email, or processing credit cards, involve interstate communication or transactions, individual coverage under the FLSA may apply more widely than many employees or employers realize, potentially extending protections to workers in smaller businesses that don’t meet the $500,000 enterprise threshold.

For more details on FLSA coverage, consult the DOL’s Fact Sheet #14: Coverage Under the FLSA.

What is a “Workweek” and “Hours Worked”?

Understanding two key terms—”workweek” and “hours worked”—is essential for determining FLSA compliance, particularly regarding overtime pay.

Workweek

The FLSA operates on a workweek basis. A workweek is defined as a fixed and regularly recurring period of 168 consecutive hours – that’s seven consecutive 24-hour periods.

• Fixed Period: Your workweek can begin on any day of the week and at any hour of the day, as established by your employer. For example, a workweek could run from Sunday at 12:00 AM to Saturday at 11:59 PM, or from Wednesday at 9:00 AM to the following Wednesday at 8:59 AM.
• Stands Alone: For minimum wage and overtime calculations, each workweek stands on its own. An employer cannot average your hours over two or more workweeks to avoid paying overtime. If you work 30 hours one week and 50 hours the next, you are still entitled to overtime pay for the 10 hours worked over 40 in the second week.
• Basis for Compliance: Employee coverage, minimum wage compliance, overtime calculations, and the application of most exemptions are determined on a workweek basis.

Hours Worked (General Definition)

In general, “hours worked” under the FLSA includes all the time during which an employee is required to be on duty, on the employer’s premises, or at any other prescribed place of work. This period generally runs from the beginning of the first “principal activity” of the workday to the end of the last principal activity of the workday.

Crucially, “hours worked” also includes any additional time the employee is “suffered or permitted” to work. This means that if an employer knows or has reason to believe that an employee is performing work (even if it wasn’t requested or authorized), that time generally counts as hours worked and must be paid for. We will explore specific examples of what counts as hours worked in more detail in a later section.

For a good overview of these concepts, refer to the DOL’s Handy Reference Guide to the FLSA.

Could You Be Exempt from Overtime Pay? The “White Collar” Exemptions

Even if you are covered by the FLSA under enterprise or individual coverage, you might not be entitled to overtime pay if your job qualifies for a specific “exemption.” The FLSA contains several exemptions, but the most common ones related to overtime are often called the “white collar” exemptions. These apply to employees working in bona fide Executive, Administrative, Professional (EAP), Computer, and Outside Sales roles.

Employees who meet the requirements for an exemption are considered “exempt” from the FLSA’s overtime (and sometimes minimum wage) requirements. Employees who do not meet the exemption requirements are “non-exempt” and must receive overtime pay for hours worked over 40 in a workweek.

Important Note: Job titles alone do not determine whether an employee is exempt or non-exempt. Your actual job duties and how you are paid are what matter.

The Three Tests for Exemption (Executive, Administrative, Professional)

For the main EAP exemptions (Executive, Administrative, and Professional), an employee generally must meet all three of the following tests to be exempt from overtime:

1. The Salary Basis Test
2. The Salary Level Test
3. The Duties Test

Let’s break down each test:

The Salary Basis Test

To meet this test, you must be paid on a “salary basis.” This means:

• You regularly receive a predetermined, fixed amount of pay each pay period (on a weekly or less frequent basis, like bi-weekly or monthly).
• This predetermined amount cannot be reduced because of variations in the quality or quantity of the work you perform. For example, your employer generally cannot dock your salary if you make a mistake or if there isn’t enough work to do.
• Subject to certain exceptions, you must receive your full salary for any week in which you perform any work, regardless of the number of days or hours worked. You don’t need to be paid for workweeks where you perform no work at all.

There are specific situations where deductions can be made from an exempt employee’s salary without violating the salary basis test. These include:

• Absences from work for one or more full days for personal reasons (other than sickness or disability).
• Absences of one or more full days due to sickness or disability, if the deduction is made according to a bona fide plan, policy, or practice of providing compensation for salary lost due to illness.
• To offset amounts received as jury fees, witness fees, or military pay.
• Penalties imposed in good faith for violating safety rules of major significance.
• Unpaid disciplinary suspensions of one or more full days imposed in good faith for breaking workplace conduct rules.
• Not paying the full salary in the first or last week of employment.
• Not paying the full salary for weeks where the employee takes unpaid leave under the Family and Medical Leave Act (FMLA).

Making improper deductions from an employee’s salary can jeopardize their exempt status.

Additionally, the rules allow employers to use non-discretionary bonuses, incentives, and commissions to satisfy up to 10% of the required standard salary level, provided these payments are made at least annually. There’s also a provision for a “catch-up” payment at the end of the year if needed.

For detailed guidance, see DOL Fact Sheet #17G: Salary Basis Requirement.

The Salary Level Test

In addition to being paid on a salary basis, an employee must also earn a salary that meets a minimum specified amount per week to qualify for the EAP exemptions.

• Current Salary Threshold: This area has seen recent legal challenges and changes. In 2024, the Department of Labor issued a rule to significantly increase the minimum salary threshold. However, in November 2024, a federal court in Texas vacated (cancelled) that rule nationwide. As a result of this court decision, the minimum salary level currently being enforced by the DOL for the Executive, Administrative, and Professional exemptions is $684 per week, which is equivalent to $35,568 per year. This $684 per week threshold was established by a DOL rule finalized in 2019.
• Potential Future Changes: The Department of Labor may appeal the court’s decision, or future rulemaking could occur. However, as of now, the $684 per week ($35,568 per year) level is the standard employers must meet for these exemptions.
• Exceptions: The salary level test does not apply to outside sales employees, teachers, and employees practicing law or medicine. Certain computer employees can also qualify for exemption if paid on an hourly basis at a rate of at least $27.63 per hour, instead of meeting the salary level test.

The salary threshold acts as a critical, objective first screen. If an employee earns less than $684 per week, they generally cannot be classified as exempt under the EAP rules, regardless of their job duties. The recent legal battle over attempts to raise this threshold highlights its significance but also creates uncertainty. Sticking to the currently enforced $684/week standard provides the most practical guidance for now.

The Duties Tests

Even if an employee meets the salary basis and salary level tests, they must also meet specific requirements related to their job duties to qualify for an EAP exemption. The employee’s “primary duty” – the principal, main, or most important duty they perform – is key. Remember, job titles are not controlling; it’s the actual work performed that matters. Misclassification often occurs when an employee’s title (like “Assistant Manager”) suggests exempt duties, but their actual day-to-day tasks are primarily non-exempt.

Here’s a summary of the duties tests for each main white-collar exemption:

Executive Exemption:

• Primary duty must be managing the enterprise or a customarily recognized department or subdivision.
• Must customarily and regularly direct the work of at least two or more other full-time employees (or their equivalent).
• Must have the authority to hire or fire other employees, OR their suggestions and recommendations regarding hiring, firing, advancement, promotion, or other changes in status must be given particular weight.

Administrative Exemption:

• Primary duty must be the performance of office or non-manual work directly related to the management or general business operations of the employer or the employer’s customers. This type of work relates to assisting with running or servicing the business (e.g., finance, accounting, HR, marketing, quality control, purchasing, IT administration, legal compliance) rather than producing or selling the company’s primary product or service.
• Primary duty must include the exercise of discretion and independent judgment with respect to matters of significance. This involves comparing and evaluating possible courses of action and making decisions or recommendations after considering various possibilities, often concerning important business matters, without constant direct supervision.

Professional Exemption (Learned Professional):

• Primary duty must be performing work requiring advanced knowledge. This work is predominantly intellectual, requiring the consistent exercise of discretion and judgment.
• The advanced knowledge must be in a field of science or learning (e.g., law, medicine, theology, accounting, engineering, architecture, teaching, science, pharmacy).
• The advanced knowledge must be customarily acquired through a prolonged course of specialized intellectual instruction (e.g., a college degree or higher in a specific field).

Professional Exemption (Creative Professional):

• Primary duty must be performing work requiring invention, imagination, originality, or talent in a recognized field of artistic or creative endeavor (e.g., music, writing, acting, graphic arts).

Computer Employee Exemption:

• Must be compensated either on a salary or fee basis of at least $684 per week OR on an hourly basis of at least $27.63 per hour.
• Must be employed as a computer systems analyst, computer programmer, software engineer, or other similarly skilled worker in the computer field.
• Primary duty must consist of one or more of the following:
  1. Applying systems analysis techniques and procedures to determine hardware, software, or system functional specifications;
  2. Designing, developing, documenting, analyzing, creating, testing, or modifying computer systems or programs based on user or system design specifications;
  3. Designing, documenting, testing, creating, or modifying computer programs related to machine operating systems; OR
  4. A combination of these duties requiring the same level of skill.

This exemption generally does not apply to employees engaged in manufacturing or repairing computer hardware or employees whose work is highly dependent on using computers but who are not primarily engaged in the core systems analysis/programming duties described above.

Outside Sales Exemption:

• Primary duty must be making sales (as defined in the FLSA) or obtaining orders or contracts for services or the use of facilities.
• Must be customarily and regularly engaged away from the employer’s place or places of business (e.g., visiting customer sites).
• Note: There is no salary basis or salary level requirement for the outside sales exemption.

Highly Compensated Employee (HCE) Exemption

The FLSA provides a simplified duties test for certain highly paid employees. To qualify for the HCE exemption:

• The employee must perform office or non-manual work.
• The employee must earn a total annual compensation of at least $107,432 (this amount also reverted to the 2019 level due to the November 2024 court decision). This total compensation must include at least $684 per week paid on a salary or fee basis. The remainder can come from commissions, bonuses, etc.
• The employee must customarily and regularly perform at least one of the duties required for the executive, administrative, or professional exemptions.

This exemption is not automatic based solely on high pay; the employee must still regularly perform at least one identifiable exempt duty.

Key DOL Resources:

• Fact Sheet #17A: Overview of White Collar Exemptions
• Fact Sheet #17C: Administrative Exemption
• (Other fact sheets cover Executive (17B), Professional (17D), Computer (17E), and Outside Sales (17F) duties in more detail.)

How is Your “Regular Rate of Pay” Calculated for Overtime?

If you are a non-exempt employee covered by the FLSA, you are entitled to overtime pay at a rate of one and one-half times your “regular rate of pay” for all hours worked over 40 in a workweek. But what exactly is your “regular rate”? It’s not always just your stated hourly wage or salary.

Definition and Calculation

The regular rate is essentially your average hourly earnings for the workweek. It’s calculated by dividing your total compensation for the workweek (with some specific exceptions allowed by the FLSA) by the total number of hours you actually worked during that week.

Formula: Total Weekly Compensation (excluding statutory exclusions) ÷ Total Hours Actually Worked = Regular Rate

This calculation must be performed for each workweek, because your regular rate can change from week to week depending on factors like bonuses earned or hours worked. Your regular rate cannot be less than the applicable federal, state, or local minimum wage.

What’s Included in Total Compensation?

Generally, “all remuneration for employment” must be included in your total compensation before dividing by hours worked. This means you need to add up all forms of pay you received for your work during the week, except for specific payments the FLSA allows to be excluded. Common types of compensation that must be included are:

• Hourly wages: Your base hourly pay for all hours worked.
• Salary (for non-exempt employees): If you are non-exempt but paid a salary, that salary must be included.
• Piece-rate earnings: Pay based on the number of units produced.
• Commissions: Payments based on sales or services performed are generally included, unless they meet specific criteria for exclusion.
• Non-discretionary Bonuses: This is a crucial category. If a bonus payment is promised in advance or based on a predetermined formula or standard (like meeting production goals, attendance records, quality targets, safety records, or simply inducing employees to work more efficiently), it is considered non-discretionary and must be included in the regular rate calculation. If a non-discretionary bonus covers a period longer than one workweek (e.g., a monthly or quarterly bonus), it must be apportioned back over the workweeks it was earned to correctly recalculate the regular rate and any additional overtime pay due for those weeks (often called a “look-back” calculation). Mistakenly treating these bonuses as excludable is a common and potentially costly error.
• Shift Differentials and Other Premium Pay: Extra pay for working undesirable shifts (like nights or weekends) or performing hazardous duties is typically included, unless it qualifies as a true overtime premium.
• On-Call Fees: Payments for being on call may need to be included.
• Value of Goods or Facilities: The reasonable cost or fair value of non-cash payments provided as wages (like room and board) must be included.

What’s Excluded from Total Compensation?

The FLSA specifically lists certain types of payments that can be legally excluded from the regular rate calculation. These do not increase your regular rate for overtime purposes:

• Discretionary Bonuses: A bonus can be excluded only if the decision to pay the bonus AND the amount of the bonus are determined at the sole discretion of the employer at or near the end of the period, and it’s not paid according to any prior contract, agreement, or promise that would lead an employee to expect it. Simply labeling a bonus “discretionary” doesn’t make it so if these conditions aren’t met. This distinction is critical: if a bonus is expected or tied to metrics, it’s likely non-discretionary and must be included in the regular rate.
• Gifts: Payments given as gifts for special occasions (like holidays) or as rewards for service can be excluded, but only if the amount is not measured by or dependent on hours worked, production, or efficiency.
• Payments for Time Not Worked: Pay for vacation, holidays, sick leave, or other paid time off when no work is performed.
• Reimbursements: Payments that reimburse employees for actual or reasonably approximate business expenses, such as travel costs, work supplies, or tools.
• Overtime Premiums: The extra half-time pay already provided for overtime hours is excluded.
• True Premium Pay: Extra pay (at least 1.5 times the rate for similar work during non-overtime hours) for working on Saturdays, Sundays, holidays, regular days of rest, or outside the basic workday or workweek established by contract or agreement, can often be excluded under specific conditions.
• Stock Options: Value derived from qualifying stock option programs.
• Benefit Contributions: Employer contributions to bona fide benefit plans (like health insurance, retirement plans).

Common Calculation Pitfalls

• Fixed Sum for Overtime: Paying a flat bonus or lump sum for working overtime hours, without regard to the actual number of overtime hours worked, does not qualify as proper overtime pay. The entire lump sum must be included in the regular rate calculation.
• Salary for Long Workweeks: Paying a fixed salary for a workweek that regularly exceeds 40 hours (e.g., $500 for a 45-hour week) does not automatically satisfy the overtime requirement. The regular rate must be calculated by dividing the total salary by all hours worked (e.g., $500 / 45 hours = $11.11/hr). Then, the additional half-time premium must be paid for the overtime hours (e.g., 5 OT hours * ($11.11 * 0.5) = $27.78 additional pay). Using only the base hourly rate when other compensation like non-discretionary bonuses or commissions are paid is a frequent error leading to underpayment.

Key DOL Resources:

• Fact Sheet #23: Overtime Pay
• Fact Sheet #56A: Overview of the Regular Rate of Pay
• Fact Sheet #56C: Bonuses Under the FLSA

What Counts as “Hours Worked”?

Knowing your regular rate is only half the equation for calculating overtime. You also need to know which hours count as “hours worked” under the FLSA. As mentioned earlier, the general rule is that hours worked include all time an employee must be on duty, on the employer’s premises, or at a prescribed work location, from the start of the first main job activity to the end of the last one.

The “Suffer or Permit” Standard

A critical concept is that work time includes not only hours the employer requires but also hours the employer “suffers or permits” the employee to work. This means if your employer knows or has reason to believe you are working, even if you weren’t asked to or if the work happens outside your scheduled shift (like finishing tasks after clocking out, working through lunch, or responding to emails from home), that time generally must be counted as hours worked and paid for.

Management has a duty to exercise control and prevent work they do not want performed; simply having a rule against unauthorized work is not enough if the employer knows or should know it’s happening. This “suffered or permitted” standard places a significant responsibility on employers to monitor work and ensure all time is captured, as they can be liable for unpaid wages even for work they didn’t explicitly authorize.

Pay for Specific Activities

Here’s how the FLSA generally treats common situations:

Waiting Time:

Whether waiting time counts as work depends on the circumstances.

• Compensable (“Engaged to Wait”): If you are unable to use the waiting time effectively for your own purposes because you are essentially waiting for your next task (e.g., a secretary reading while waiting for dictation, a factory worker waiting for machinery repair), this time is usually considered hours worked.
• Not Compensable (“Waiting to be Engaged”): If you are completely relieved from duty and the break is long enough for you to use the time for your own purposes, it’s generally not work time.

On-Call Time:

• Compensable: If you are required to remain on your employer’s premises while on call, that time is generally hours worked.
• Generally Not Compensable: If you are allowed to stay at home or elsewhere but must leave contact information, the on-call time itself is usually not hours worked. However, if the conditions of being on call are so restrictive that you cannot effectively use the time for your own personal activities (e.g., you must respond immediately, cannot travel far, calls are very frequent), the time may become compensable. Any time actually spent responding to a call while on-call is, of course, hours worked.

Rest and Meal Periods:

• Rest Breaks (Short): Short breaks, usually 20 minutes or less, are common and generally considered compensable hours worked.
• Meal Breaks (Bona Fide): Meal periods, typically 30 minutes or longer, are not considered work time and do not have to be paid if the employee is completely relieved from duty for the purpose of eating. If you are required to perform any duties, whether active (like answering phones) or inactive (like being available to respond immediately), while eating, the entire meal period must generally be paid. This “completely relieved from duty” standard is crucial and often leads to violations, particularly in industries like healthcare where interruptions are common.

Sleeping Time:

• Duty of less than 24 hours: If you are required to be on duty for less than 24 hours, any time you are permitted to sleep is still considered hours worked.
• Duty of 24 hours or more: If your duty period is 24 hours or longer, you and your employer may agree to exclude a bona fide, regularly scheduled sleeping period of up to 8 hours from hours worked, provided the employer furnishes adequate sleeping facilities and you can usually enjoy an uninterrupted night’s sleep (at least 5 hours).

Lectures, Meetings, and Training Programs:

Time spent attending these activities is considered hours worked unless all four of the following conditions are met:

1. Attendance is outside your regular working hours.
2. Attendance is voluntary.
3. The event is not directly related to your job.
4. You do not perform any productive work during the event.

Travel Time:

Compensability depends on the type of travel:

• Normal Commute: Travel from home to your regular worksite before the workday begins and back home after it ends is generally not work time.
• Special One-Day Assignment in Another City: If you normally work at one location but are sent to another city for a single day and return home the same day, the travel time to and from the other city is work time, except that the employer can deduct the time you would normally spend commuting to your usual worksite.
• Travel as Part of the Job: Time spent traveling during the workday as part of your principal activities (e.g., a repair technician traveling between customer sites, a construction worker moving between job sites) is work time.
• Overnight Travel (Away from Home): Travel that keeps you away from home overnight is work time when it cuts across your normal working hours. This applies even if the travel occurs on your regular days off (like weekends). However, under DOL enforcement policy, time spent traveling away from home outside of your normal working hours as a passenger on an airplane, train, boat, bus, or car is generally not considered work time. Time spent driving during overnight travel is generally considered work time. The complexity of these travel rules requires careful attention, especially in industries like construction where travel between sites is common.

Key DOL Resource: Fact Sheet #22: Hours Worked Under the Fair Labor Standards Act (FLSA)

Common Overtime Violations to Watch For

Understanding the FLSA rules is the first step; recognizing common ways these rules are violated is crucial for protecting your rights. Wage and hour violations can be costly for employers and mean lost wages for employees. Here are some frequent FLSA overtime violations:

Misclassification of Employees

This is one of the most frequent and potentially costly violations. It happens in two main ways:

• Incorrectly Classifying Employees as Exempt: Employers might classify employees under the Executive, Administrative, Professional, Computer, or Outside Sales exemptions when they don’t actually meet all the required tests (salary basis, salary level, and duties). Common examples include giving employees titles like “Assistant Manager” or “Supervisor” but having them primarily perform non-exempt tasks like running cash registers, stocking shelves, or cleaning. Certain types of analysts or IT support staff may also be misclassified if their primary duties don’t involve the required level of discretion, independent judgment, or specific computer systems/programming work. A major error is assuming any employee paid a salary is automatically exempt; salary status alone does not determine exemption. The duties performed are critical.
• Incorrectly Classifying Employees as Independent Contractors: Some employers treat workers as independent contractors (often issuing a Form 1099) to avoid paying minimum wage, overtime, and benefits. Whether a worker is truly an independent contractor or an employee under the FLSA depends on the “economic reality” of the relationship – essentially, whether the worker is economically dependent on the employer or genuinely in business for themselves. The DOL uses a multi-factor test (including opportunity for profit/loss, investment, permanency, control, work integration, skill/initiative) to make this determination. See Fact Sheet #13: Employee or Independent Contractor Classification.

Failure to Pay for All Hours Worked (“Off-the-Clock” Work)

Employers must pay non-exempt employees for all time worked, including time they “suffer or permit” the employee to work. Violations occur when employers fail to compensate for:

• Work performed before the official start time or after the official end time (e.g., setting up, cleaning up, finishing tasks, checking email).
• Work performed during unpaid meal breaks if the employee is not completely relieved of duties. Automatically deducting time for meal breaks without ensuring the breaks were actually taken and uninterrupted is a high-risk practice, especially common in healthcare.
• Time spent attending required training sessions or meetings.
• Compensable travel time, waiting time, or on-call time.
• Time where records are altered (“shaved”) by supervisors or employees are pressured not to report all their hours, perhaps due to unrealistic deadlines or production goals. Even if work wasn’t explicitly authorized, if the employer knew or should have known it was being done, it generally must be paid.

Incorrect Calculation of the Overtime Rate

Even if overtime hours are counted correctly, violations occur if the pay rate is wrong:

• Calculating overtime based only on the employee’s base hourly wage, ignoring other required components of the “regular rate” like non-discretionary bonuses, commissions, or shift differentials.
• Paying “straight time” (the regular hourly rate) for overtime hours instead of the required time-and-a-half premium.
• Paying workers a flat “day rate” regardless of hours worked, without calculating and paying the additional half-time premium for weekly hours over 40.
• Incorrectly applying special calculation methods like the fluctuating workweek.

Improper Deductions

Making deductions from an employee’s pay for items like cash register shortages, damaged equipment, customer walkouts, or the cost of required uniforms or tools can be illegal if these deductions reduce the employee’s earnings below the required minimum wage or cut into the overtime pay due.

Failure to Combine Hours Worked

If an employee works for the same employer in two different jobs or at two different locations within the same workweek, the employer must combine all hours worked in that week to determine if overtime is due.

Recordkeeping Violations

Failure to make and keep accurate records of hours worked and wages paid for non-exempt employees is itself a violation and can make it harder to resolve wage disputes.

Industry context often highlights specific risks. For example, healthcare employers frequently face issues with automatic meal break deductions and properly compensating for on-call time or using the “8 and 80” overtime calculation correctly. The construction industry often sees violations related to misclassifying workers as independent contractors, failing to pay for travel time between job sites, or improperly paying piece rates or day rates without accounting for overtime.

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