How do you calculate overtime pay in Delaware?

Calculating overtime pay accurately is essential for employers and employees to ensure fair compensation and compliance with labor laws. In Delaware, the state’s overtime regulations are governed by the Fair Labor Standards Act (FLSA). Understanding the proper methods for calculating overtime helps prevent payroll errors, avoid disputes, and ensure adherence to legal requirements.

This article provides a comprehensive guide on how to calculate overtime pay in Delaware, covering various scenarios and offering practical examples to help navigate these calculations effectively.

Which Overtime Laws Apply in Delaware?

Delaware follows the federal Fair Labor Standards Act (FLSA) to regulate overtime provisions in the state. Under the FLSA, employees must be paid overtime at one and a half (1.5) times their regular hourly rate for any hours worked over 40 in a workweek.

Delaware does not have state-specific overtime legislation, so federal guidelines apply.

How Much is Overtime Pay in Delaware?

Overtime pay in Delaware is calculated at 1.5 times the employee’s regular rate of pay for each hour worked over 40 in a workweek. Regular pay rate includes not only hourly wages but also other forms of compensation like commissions, bonuses, and incentive pay.

To learn more, check out our guide on Delaware Overtime Laws. 

Who is Eligible for Overtime Pay in Delaware?

Most non-exempt employees in Delaware are eligible for overtime pay. The FLSA specifies that non-exempt employees are paid hourly, earn less than the salary threshold of $844 weekly or $43,888 annually, or do not fit into specific exempt categories (i.e., executive, administrative, or professional roles).

Check out our guide on Overtime Rights in Delaware.

Hourly employees are paid for each hour they work. For calculating overtime pay for hourly employees in Delaware:

• Determine the regular rate of pay: The employee’s fixed hourly rate is their regular rate. For example, if a Delaware employee earns $14 per hour, that’s their regular rate of pay.
• Calculate the overtime rate: Multiply the regular rate of pay by 1.5 times to get the overtime rate. The employee’s overtime rate would be $21 ($14 x 1.5).
• Identify overtime hours: Overtime pay applies when an employee works over 40 hours in a single workweek. If the employee worked 50 hours in a week, the overtime hours is ten (50 – 40).
• Calculate overtime pay: Multiply the overtime hours by the overtime rate. From the example, the overtime pay would be $210 (10 hours x $21).

Read our guide on Your Rights as an Hourly Employee in Delaware to learn more.

Salaried employees receive a fixed amount of pay each pay period, regardless of the number of hours worked. Their salary is usually calculated annually and divided into regular pay periods (weekly, biweekly, or monthly).

Some salaried employees are eligible for overtime if considered non-exempt under the FLSA, while others may be exempt due to specific duties and salary thresholds.

To calculate overtime pay for eligible salaried employees in Delaware:

• Determine the regular rate of pay: Divide the employee’s weekly salary by the number of hours the salary is intended to cover, usually 40 hours for a standard workweek. For example, if the weekly salary is $820, the regular rate would be $20.5 ($820 ÷ 40).
• Calculate overtime rate: Multiply the regular rate of pay by 1.5 times to get the overtime rate. If the employee’s regular rate is $20.5, the overtime rate would be $30.75 ($20.5 x 1.5).
• Identify the number of overtime hours: Overtime applies to hours worked over 40 in a single workweek. If the employee works 45 hours a week, the overtime is five (45 – 40).
• Calculate overtime pay: Multiply the number of overtime hours by the overtime rate to get the overtime pay. From the example above, if the employee’s overtime rate is $30.75, the overtime pay for the additional five hours would be $153.75 (5 hours x $30.75).

Check out our guide on Your Rights as a Salaried Employee in Delaware.

Commission employees earn based on sales or performance rather than a fixed hourly or salary rate. Here’s how to calculate overtime for commission employees in Delaware:

• Determine the total weekly earnings: Add all earnings from commissions. For instance, if the employee earns a base pay of $600 and a commission pay of $220, the total earnings would be $820 ($600 + 220).
• Calculate the regular rate of pay: Divide the total weekly earnings by the total number of hours worked. If an employee earns $820 in commissions for 50 hours, the regular rate would be $16.40 per hour ($820 ÷ 50).
• Calculate the overtime rate: Multiply the regular rate by 0.5. If the regular rate is $16.40, the overtime rate would be $8.20 ($16.40 x 0.5).
• Identify the overtime hours worked: Any hours worked over 40 in a workweek are considered overtime. Here, the overtime hours would be ten (50 hours – 40 hours).
• Calculate the overtime pay: Multiply the overtime hours by the overtime rate. If the overtime rate is $8.20 and the employee worked ten overtime hours, the overtime pay would be $82 ($8.20 x 10).

Piece rate employees are paid based on the number of units produced or tasks completed rather than hourly wages. Here’s how to calculate overtime pay for piece rate employees in Delaware:

• Calculate the total earnings for the week: Multiply the number of units completed by the piece rate. If an employee completed 1,365 pieces at $0.55 per piece, the total earnings would be $750.75 (1,365 units x $0.55).
• Determine the regular rate of pay: If the employee worked 48 hours, the regular hourly rate would be $15.64 ($750.75 ÷ 48).
• Calculate the overtime rate: Multiply the regular rate by 0.5. If the regular rate is $15.64, the overtime rate would be $7.82 ($15.64 x 0.5).
• Identify the overtime hours worked: Any hours worked beyond 40 in a workweek are overtime hours. In this case, the overtime hours would be eight (48 – 40).
• Calculate the overtime pay: Multiply the overtime hours by the overtime rate. If the overtime rate is $7.82 and there are eight overtime hours, the overtime pay would be $78.20.

A recent amendment to the Delaware Code § 8111 aligns the state’s statute of limitations with the federal FLSA. According to the updated code, claims for unpaid wages, salary, or overtime must be filed within two years from the payment date.

Under the FLSA, the statute of limitations also sets a two-year limit for standard claims of unpaid overtime. However, for willful violations, where an employer knowingly disregards the wage and hour provisions, the FLSA extends the statute of limitations to three years. Employees may pursue federal claims under the FLSA’s extended three-year statute in cases of willful non-compliance.

Delaware follows the recordkeeping standards set by the FLSA for wage compliance. Employers must maintain accurate records of the following information for non-exempt employees:

• Personal information: Employee’s name, address, occupation, and Social Security number.
• Work hours: Number of hours worked each day and the total hours worked each week.
• Pay details: Regular hourly rate, total daily or weekly earnings, overtime pay for each overtime hour worked, and total wages paid each pay period.
• Dates and pay periods: Dates of payments and the corresponding pay periods.

Employers must keep these records for at least three years, while payroll records used to compute wages should be retained for two years.