Federal overtime rules (FLSA)
Under federal law, a non-exempt employee earns overtime after 40 hours in a workweek, at 1.5 times the regular rate. Federal law has no daily overtime; each workweek is counted on its own.
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Overtime after 40 hours in a workweek
40 hours is the line. Every hour over 40 in a workweek is overtime. Overtime pays at least 1.5 times the regular rate.
Example. 45 hours at $20.00. Regular: 40 × $20.00 = $800.00. Overtime: 5 × $30.00 = $150.00. Total: $950.00.
The workweek is a fixed 168 hours
168 hours: seven 24-hour periods in a row. It can start on any day and any hour. Once set, it stays fixed. It can change only if the change is meant to be permanent and is not designed to avoid overtime.
Example. Workweek starts Wednesday 12:00 a.m. Hours from Wednesday through the next Tuesday count together, even if the pay period runs Monday to Sunday.
Each workweek stands alone
No averaging across 2 or more weeks. A 30-hour week does not cancel a 50-hour week. This holds whether pay is hourly, daily, weekly, biweekly or monthly.
Example. Week 1: 30 hours. Week 2: 50 hours. Overtime owed: 10 hours in week 2, even though the two-week average is 40.
No daily overtime under federal law
0 daily overtime under the FLSA. The federal test is hours in the workweek only. A 12-hour day is straight time federally if the week stays at 40 or under. Some states and territories add daily overtime: see Alaska, California, Colorado, Nevada and Puerto Rico.
Example. Mon 12h, Tue 12h, Wed 12h, Thu 4h = 40 hours. Federal overtime: 0 hours.
Regular rate: all pay for the week, divided by hours worked
The regular rate is an hourly rate. It includes all pay for employment in the workweek, except payments the law excludes (such as true gifts and pay for vacation, holiday or sick time not worked). Divide that pay by hours actually worked that week. It can never be below the minimum wage.
Example. 45 hours at $18.00 plus a $90.00 production bonus. Pay: 45 × $18.00 + $90.00 = $900.00. Regular rate: $900.00 ÷ 45 = $20.00. Overtime premium: 5 × $10.00 = $50.00. Total: $950.00.
Regular rate when working at two or more rates
When someone works at two or more hourly rates in one workweek, the regular rate is the weighted average: total straight-time pay divided by total hours worked. Overtime adds half that rate for each overtime hour.
Example. 30 hours at $15.00 and 15 hours at $20.00. Straight-time pay: $450.00 + $300.00 = $750.00. Regular rate: $750.00 ÷ 45 = $16.67. Overtime premium: 5 × ½ × $16.67 = $41.67. Total: $791.67.
Exempt employees: ask a professional
Some employees are exempt from overtime under section 13 of the FLSA and other provisions. Whether someone is exempt depends on duties, pay and the type of work. HoursReady does not decide exemption.
Example. A salaried manager may or may not be exempt. Job title alone does not decide it.
Questions
Does the FLSA require overtime after 8 hours in a day?
No. The federal rule counts hours in the workweek only. Some states do have daily overtime.
Can two weeks be averaged to avoid overtime?
No. Each workweek stands alone under 29 CFR 778.104.
Is the workweek the same as the pay period?
Not necessarily. The workweek is a fixed 168-hour period. A biweekly pay period holds two separate workweeks.
Do bonuses change the overtime rate?
Often, yes. The regular rate includes all pay for employment unless the law excludes it. A production bonus usually raises the regular rate for that week.
Who is exempt?
That depends on duties, pay and industry. Exemption questions need a professional.
This page explains published rules. It is not legal advice. Exemption questions need a professional. Not affiliated with the U.S. Department of Labor or any state agency.