Arkansas labor law sets overtime regulations that ensure fair compensation for employees. This article covers key aspects of Arkansas overtime rules, including pay rates, eligibility, exemptions, and special considerations for tipped and salaried employees.
Arkansas Overtime Laws Summary
| State overtime law | Overtime applies to all hours worked over 40 hours in a workweek |
| Overtime pay rate | 1.5 times the regular rate of pay for all overtime hours |
| Minimum wage | $11 per hour |
| Minimum overtime wage | $16.5 per hour for minimum wage workers |
| Compensatory time instead of overtime pay | Allowed for public agency employees |
| Salary threshold for overtime exemption | $684/week |
This Article Covers
- Overtime Pay Rates in Arkansas
- Who is Entitled to Overtime in Arkansas?
- Overtime Exemptions in Arkansas
- Is Compensatory Time Allowed in Arkansas?
- Overtime for Tipped Employees in Arkansas
- Overtime for Salaried Employees in Arkansas
- Overtime for Commissioned Employees in Arkansas
- Recordkeeping Requirements for Employers in Arkansas
- Penalties for Violating Overtime Laws in Arkansas
Overtime Pay Rates in Arkansas
Employees who work over 40 hours in a week in Arkansas are entitled to overtime pay at a rate of time-and-a-half (1.5) times their regular rate of pay, for every additional hour worked.
Since the minimum wage in Arkansas is $11 per hour, the state’s minimum overtime wage is $16.50 (1.5 x 11) per hour.
| Employee’s Regular Rate of Pay | Overtime Rate | |
| Minimum wage in Arkansas | $11.00 per hour | $16.50 per hour |
| Example 1 | $20.00 per hour | $30.00 per hour |
| Example 2 | $30.00 per hour | $45.00 per hour |
What counts as hours worked for overtime calculations in Arkansas?
In Arkansas, overtime is based on the actual hours an employee works in a workweek. Paid time off, such as holidays, sick leave, or vacation, does not count as hours worked.
Working more than eight hours in a single day does not automatically qualify for overtime unless the employee’s weekly total exceeds 40 hours.
In short, overtime in Arkansas is calculated only from the total number of hours an employee actually works during the workweek.
What is a workweek under the FLSA?
A workweek is a set period of 168 hours (seven consecutive 24-hour days). The employer can decide when the workweek begins, including the day and exact time.
Under the FLSA, each workweek is calculated separately for minimum wage and overtime purposes. Employers cannot average an employee’s hours across multiple weeks to avoid paying overtime.
Who is Entitled to Overtime in Arkansas?
Under the Arkansas Minimum Wage Act, employers with four or more employees must follow state wage and overtime rules. Employers covered by the federal Fair Labor Standards Act (FLSA) must also follow these rules if they have at least four employees.
In most cases, non-exempt employees under the FLSA are entitled to overtime pay in Arkansas. These employees include those earning less than $684 a week (i.e., $35,568 per year) and working in a non-exempt industry.
Some employees may be exempt from overtime, and certain workplaces, such as police departments, fire departments, hospitals, and residential care facilities, may follow special overtime rules, which we will cover in the next section.
Overtime Exemptions in Arkansas
Some employees and industries are exempt from the overtime laws under the Arkansas Minimum Wage Act, including:
- Executive, administrative, and professional employees
- Certain computer professionals
- Highly compensated employees
- Outside sales employees
- Certain government-related employees
- Certain legislative staff, such as legislative attorneys, auditors, editors, and analysts
- Students working for a school, college, or university where they are enrolled
- Independent contractors
- Some agricultural workers, including those working for family members, seasonal laborers, and those engaged in livestock range production
- Forestry and timber operations employees working with eight or fewer workers
- Some nonprofit and seasonal workers
- Newspaper and media workers with limited circulation
- Domestic service workers, such as casual babysitters, caregivers for elderly or disabled individuals, and employees living in the household where they work
- Transportation and delivery workers, including taxi drivers
- Some radio or television station announcers, news editors, or engineers in small markets
- Sales and service employees in vehicle dealerships
- Employees working at amusement or recreational facilities in national parks or forests
Even if an employee falls into one of these categories, overtime rules under the federal FLSA may still apply depending on the employer and job duties.
To qualify for an exemption:
- Most exempt employees must earn at least $684 per week (or $35,568 per year).
- Highly compensated employees may be exempt if they earn at least $107,432 per year, including at least $684 per week paid on a salary or fee basis.
Public agencies in Arkansas may give compensatory time off (comp time) instead of paying overtime wages.
Public safety employees in fire protection or law enforcement may follow special overtime calculation rules allowed under the FLSA, as long as overtime pay complies with federal standards.
For more information, refer to the Arkansas guide on overtime rules.
Is Compensatory Time Allowed in Arkansas?
Public agencies, such as the state or local governments, are allowed to provide compensatory time off (comp time) to their employees instead of paying overtime wages. Here are the rules that apply:
- Employees must receive at least 1.5 hours of comp time for each overtime hour worked.
- Comp time can only be given if it is allowed under a collective bargaining agreement, memorandum of understanding, or another agreement with employee representatives, or if there is a prior agreement between the employer and the employee before the overtime work is performed.
- Employees cannot accumulate unlimited compensatory time. Police, firefighters, emergency responders, and seasonal workers can accumulate up to 480 hours, and other public employees can accrue up to 240 hours comp time.
Overtime for Tipped Employees in Arkansas
In Arkansas, tipped employees are workers whose income regularly includes tips. Common examples include:
- Waiters and waitresses
- Bellhops
- Barbers
- Beauty operators
Other workers may also qualify as tipped employees if they receive more than $20 per month in tips.
Here, it is important to note that:
- A tip is money a customer voluntarily gives for service. This may include cash tips, tips paid by check, and credit-card tips added to the bill.
- Non-cash gifts and mandatory service charges don’t count as tips.
- Tip pooling is allowed if employees agree to share tips. In this case, the employer may collect and redistribute pooled tips according to an agreed system. The amount each employee ultimately receives and keeps counts as their tips.
Employers in Arkansas must pay tipped employees at least $2.63 per hour in direct cash wages. They may apply a tip credit of up to $3.62 per hour toward the employee’s wages.
However, the employee’s total earnings (cash wages + tips) must equal at least the state minimum wage of $11.00 per hour. If tips and wages combined do not reach the minimum wage, the employer must pay the difference.
That being said, tipped employees in Arkansas must still receive overtime pay for hours worked over 40 in a workweek.
When calculating overtime, the tipped employee’s regular rate of pay includes the cash wage paid by the employer and the tip credit claimed by the employer.
Tips above the tip credit (more than $3.62 per hour) do not need to be included when calculating the overtime rate.
For example:
Arkansas minimum wage: $11.00 per hour
Overtime rate: 1.5 x $11.00 = $16.50 per hour
Maximum tip credit: $3.62 per hour
If a tipped employee works 45 hours in a week, the employer must pay overtime for the five extra hours worked.
For each overtime hour:
Base overtime rate: $16.50
Employer may still apply the $3.62 tip credit
So the employer must pay at least $12.88 per overtime hour in cash wages ($16.50 − $3.62), assuming the employee earns enough tips to cover the credit.
If a tipped employee spends 20 minutes or more within an hour performing non-tipped work, the employer cannot apply the tip credit for that hour. In that case, the employee must be paid the full minimum wage of $11.00 for the entire hour.
Overtime for Salaried Employees in Arkansas
For overtime calculations in Arkansas, employers must follow the federal guidelines under the provisions of 29 C.F.R. § 778.
According to it, salaried employees in Arkansas are workers who receive a set amount of pay each pay period (salary), regardless of how many hours they work.
The employee’s regular hourly rate must be calculated by dividing their weekly salary by the number of hours the salary is meant to cover.
Example:
If an employee earns $350 per week for a 35-hour workweek:
The employee’s regular hourly rate: $350 / 35 = $10 per hour
Overtime rate = 1.5 x $10 = $15 per hour for any hours worked over 40 in a workweek.
If the salary only covers fewer than 40 hours per week, such as 35 hours in this example, the employee is paid their regular hourly rate for additional hours up to 40. Overtime pay applies only after 40 hours in the workweek.
You can also use an overtime calculator to make it easier.
Overtime for Commissioned Employees in Arkansas
Employees in Arkansas who earn commissions must still receive overtime pay under the FLSA rules. The employee’s regular rate must include all earnings, including commissions, regardless of whether they are based on a percentage of sales, performance targets, or another formula.
If commissions are paid weekly, they are simply added to the employee’s total earnings for that week. The total pay is then divided by the total hours worked to find the regular hourly rate.
Example:
An employee’s weekly salary: $500
Weekly commission: $150
Total weekly pay: $500 + $150 = $650
Hours worked: 50
Regular hourly rate = $650 / 50 = $13 per hour
Overtime premium = half of the regular rate: $13 / 2 = $6.50 per hour
If the employee worked 10 overtime hours, the extra overtime pay would be:
10 × $6.50 = $65.00 additional overtime pay
Even if commissions are calculated and paid later (such as monthly), they must still be included when calculating overtime pay. In such cases:
- The employer must first pay overtime based on the employee’s salary or hourly wages.
- When the commission amount is known, the employer must recalculate overtime and pay any additional overtime owed.
- If commissions cover several weeks, employers must distribute them fairly across those weeks.
Recordkeeping Requirements for Employers in Arkansas
Employers in Arkansas are required to maintain accurate employee data for a minimum of three years. These records include, but are not limited to, an employee’s:
- Hourly rate of pay
- Weekly work schedule
- Overtime compensation rules and records
- Wage payment schedules
Although there is no set method for recordkeeping, the records must be readily accessible, securely stored, and subject to inspection at any time.
A reliable way to maintain these records is to use time tracking software like Jibble, which lets you track employee work hours from anywhere using mobile and web clock-ins. It also generates automated timesheets and detailed reports, making payroll, overtime tracking, and recordkeeping easier and more accurate.
Start tracking work time for free today!
Penalties for Violating Overtime Laws in Arkansas
Employee who believe their employer violated overtime laws can file a complaint with the Arkansas Department of Labor and Licensing. An employer who fails to follow overtime rules under the Arkansas Minimum Wage Act may face investigations, financial penalties, and orders to repay employees.
The Arkansas Division of Labor can require the employer to:
- Pay the employee all unpaid overtime wages (back pay).
- Pay liquidated damages, which can be up to the same amount as the unpaid wages for willful violations.
- Employers may also be fined $50 to $1,000 per violation if the employer:
- Pays less than the required wages or overtime
- Refuses to keep or provide required payroll records
- Falsifies wage records
- Interferes with a labor investigation
- Fails to post required wage law notices
- Retaliates against employees who file complaints or testify in a wage case
Each violation can count as a separate offense, and ongoing violations may lead to additional penalties for each day they continue.
If the employer disagrees with the decision, they can request a hearing within 15 days to challenge the assessment.
Important Cautionary Note
This content is provided for informational purposes only. While we make every effort to ensure the accuracy of the information presented, we cannot guarantee that it is free of errors or omissions. Users are advised to independently verify any critical information and should not solely rely on the content provided.
