FLSA overtime rules explained

The short version

The 40-hour workweek

Section 7(a) of the FLSA (29 U.S.C. § 207(a)) sets the federal overtime standard: an employer may not employ a covered employee for more than 40 hours in a workweek unless the employee gets overtime pay of at least one and a half times the regular rate for the hours over 40.

The workweek is not the same as a calendar week or a pay period. The Department of Labor describes it as a fixed and regularly recurring period of 168 hours, seven consecutive 24-hour periods. It can begin on any day and at any hour, but once set it stays the same. That matters for night shifts and for biweekly pay: each workweek is looked at on its own, and hours cannot be averaged over two or more weeks.

Time and a half of the regular rate

“Time and a half” means 1.5 times the regular rate. For a worker paid only by the hour, the regular rate is usually the hourly wage. Section 7(e) says the regular rate includes all remuneration for employment except the payments it lists, so some extra pay for the work, such as certain bonuses, can make the regular rate higher than the posted wage. Some payments are excluded. Section 7(e)(2) excludes pay for occasional periods when no work is done, such as vacation, holidays and illness, and the regulation at 29 CFR 778.218 adds that those payments cannot be credited toward overtime owed.

Worked example: a 50-hour week

An hourly employee earns $16.00 and works 9 hours Monday to Friday plus 5 hours on Saturday, all in one workweek: 50 hours.

Saturday is not special here: it earns overtime only because the week already had 45 hours. If the same employee had worked 35 hours that week including Saturday, no overtime would be owed under federal law.

What counts as hours worked

Overtime depends on hours actually worked, so it helps to know what counts. The Department of Labor’s Fact Sheet #22 explains that:

• Work that the employer suffers or permits, even if it was not requested, is work time. Finishing a task after the end of a shift usually counts.
• Short rest breaks, usually 20 minutes or less, are paid and count as hours worked.
• Bona fide meal periods, usually 30 minutes or more, are not work time, but only if the employee is completely relieved from duty. Eating at a desk while working is work time.
• An employee required to stay on call on the employer’s premises is working while on call. Being on call at home can be different, depending on how free the employee is to use the time.
• Normal travel from home to work is not work time; travel that is part of the day’s work generally is.

Federal law does not require lunch or coffee breaks at all; some states do. On a time card, that means you subtract only unpaid meal breaks. See the lunch break calculator for examples.

Rounding time clock punches

Employers may round punches for convenience. The regulation at 29 CFR 785.48 says rounding to the nearest 5 minutes, tenth of an hour or quarter of an hour is acceptable, as long as over time it averages out so employees are fully paid for the time they actually work. A policy that always rounds in the employer’s favor is not acceptable. The time card calculator can apply 5, 6 or 15-minute rounding so you can compare.

Exempt or non-exempt?

Overtime applies to non-exempt employees. Some employees are exempt under the executive, administrative, professional, computer and outside sales exemptions. According to the Department of Labor’s Fact Sheet #17A (revised September 2019), these exemptions generally require:

Job titles do not decide exemption, and being paid a salary is not enough on its own. Fact Sheet #17A also says the exemptions do not apply to manual laborers and other blue-collar workers who perform work involving repetitive operations with their hands. Salary thresholds have been the subject of rule changes, so check the Department of Labor’s current guidance for the figures that apply now.

What the FLSA does not require

• Extra pay for weekends, nights or holidays as such.
• Daily overtime after 8 hours.
• Paid vacation, holidays or sick leave.
• Meal or rest breaks.
• A limit on hours for employees 16 and older.

Employers can offer more than the law requires, and state laws often do. California, for example, has daily overtime after 8 hours, double time after 12 hours, and a seventh-day rule, according to the California Department of Industrial Relations. State rules like these apply in addition to the federal minimum, so check your state labor office too.

Minimum wage and overtime

The federal minimum wage has been $7.25 an hour since July 24, 2009. The Department of Labor notes that many states also have minimum wage laws, some with greater employee protections, and employers must comply with both.

Keeping records

Employers must keep accurate records of hours worked and wages paid for non-exempt employees, including hours worked each workday and total hours each workweek. The Department of Labor’s Fact Sheet #21 says any timekeeping method is fine as long as it is complete and accurate, and that time cards should be kept for 2 years and payroll records for 3 years. Keeping your own record, on paper or in a tool like this one, helps you check your pay.

Check your own week

The overtime calculator applies the federal rule by default and lets you switch to daily or California rules. For two-week pay periods, the biweekly time card keeps each workweek separate. For definitions of terms like “workweek” and “regular rate”, see the glossary.