Simple Overtime Pay Calculator

Simple Overtime Pay Calculator
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What law governs overtime pay in the US?

In the US, overtime pay is governed by the federal Fair Labor Standards Act (FLSA), with some states offering additional protections through state law.

Federally and through the FLSA, overtime is offered after 40 hours a week.

 

What is the standard overtime pay rate in the US?

In the US, overtime is set at 1.5 times the employee’s regular hourly wage for any hour worked beyond 40 in a workweek, as required by the FLSA.

As the federal minimum wage in the US is set at $7.25 per hour, the typical overtime rate for minimum wage workers is $10.87.

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How is overtime pay calculated and paid in the US?

In the US, overtime pay is calculated at 1.5 times an employee’s regular hourly rate for any hours worked over 40 in a workweek, as required by the FLSA.

Overtime pay is not required for work done on weekends, holidays, or scheduled days off unless those hours exceed 40 in the workweek. 

A workweek is defined as a consistent and recurring span of 168 hours, or seven consecutive 24-hour days, which can begin on any day and at any time. 

Employers can set different workweeks for different employees or groups, but they are not allowed to average hours across multiple weeks. 

Overtime pay should be issued on the regular payday for the period in which it was earned.

Read more on US overtime laws or try out our work hours calculator for FREE!

 

Who is eligible for overtime pay under US law? 

Under US federal law, most employees are eligible for overtime pay if they work more than 40 hours in a week, unless they are exempt.

Overtime exemption criteria are set by the FLSA, and they apply based on salary and roles, among other things.

As such, salaried workers in the US earning at least $684 per week in executive, administrative, professional, or outside sales roles are exempt from overtime.

Further, Highly Compensated Employees (HCEs), those in the Motion Picture, computer employees, and more can be exempt with varying exemption rates. 

Certain job roles may also lead to ineligibility for overtime, including farmworkers, commissioned sales employees, and drivers.

For a full list of exemptions and specific criteria, it’s best to refer to the Commonly Used Exemptions under the FLSA.

 

What are the key tips for accurately offering overtime pay in the US?

Here are some simple tips to help you track overtime accurately:

  • Stay Updated with Overtime Laws: Overtime rates in the US, as well as exemption criteria and thresholds, are expected to change from time to time; tracking these changes is essential to ensure compliance with the law. 
  • Inform your team on overtime policies: Ensure your team clearly understands key overtime elements, including eligibility and exemption, entitlement, pay dates, and hours tracking.
  • Keep records of overtime hours: Prevalently, wage and hour violations in the US result from poor documentation of work hours. Tracking overtime hours and keeping records is essential to legal compliance.