Seeing as Ohio is governed by both state and federal laws, Ohio state can provide employees with more rights than what is offered by FLSA but not any less.
This article will provide you with the information to successfully navigate Ohio’s overtime regulations, whether you’re an employer aiming for compliance or an employee defending your rights.
This article covers:
- Ohio Overtime Rates
- Overtime Entitlement in Ohio
- Refusing to Work Overtime in Ohio
- “Compensatory Time” in Ohio
- Overtime for Tipped Employees in Ohio
- Overtime for Salaried Employees in Ohio
- Calculating Overtime with Commission in Ohio
- Overtime Exceptions and Exemptions in Ohio
- Statute of Limitations For Unpaid Overtime Claims in Ohio
- Penalties for Misclassifying Employees in Ohio
- Legal Cases Relating to Overtime Compensation in Ohio
The majority of hourly employees in Ohio have the right to an overtime pay rate for any hours worked beyond 40 in a week.
Overtime in Ohio is set at 1.5 times the regular hourly rate for workers whose work exceeds 40 hours a week.
Since the regular Ohio minimum wage is $10.45 per hour, that makes Ohio’s overtime minimum wage $15.68 per hour (1.5 times the minimum wage).
Employees in Ohio who earn below $684 a week ($35,568 a year) and are non-exempt are entitled to overtime pay.
Further, the FLSA qualifies workers who meet the pay requirements for overtime for any hours worked over 40. If you’re a manual laborer such as a construction worker, factory worker, cashier, and so on, you may be entitled to overtime pay.
Read more about Overtime Exceptions and Exemptions in Ohio.
If you refuse to work overtime after your employer has scheduled you for it, your employer will have the right to invoke disciplinary action against you. This can sometimes lead to the termination of your employment.
However, this rule may be open to modification if a prior agreement or collective bargaining act (CBA) was made.
Employees may choose to take compensatory time, or “comp time”, instead of receiving overtime pay. Comp time is earned at the same rate as overtime pay. The only difference is instead of money, employees get time off from work.
There are several rules when it comes to comp time in Ohio:
- Employees can only obtain 240 hours worth of comp time
- Comp time must be used within 180 days of earning it
- Employers cannot force employees to take comp time
If an employee has been fired before being able to use their comp time, they will receive monetary compensation instead.
Under the FLSA, this practice is only legal for public employers.
Tipped employees in Ohio are eligible for overtime pay when they work more than 40 hours.
Overtime for tipped employees is calculated at the rate of time-and-a-half using their full minimum wage (without deducting any “tip credits”). An employer is not allowed to take a higher tip credit for overtime hours as compared to regular hours.
Tip credit is a system that enables employers to pay tipped employees a lower minimum wage. Simply take the standard state minimum wage minus what the tipped employee is paid.
Just because you receive a salary does not mean you are not entitled to overtime compensation in Ohio.
While most employees who are exempt (not eligible) from overtime happen to be paid on a salary basis, not all salaried employees are exempt.
An employee’s job duties, responsibilities, and weekly income are what determine overtime eligibility.
Ohio overtime laws state that employees who receive commissions are entitled to overtime compensation. Their commissions would have to be included in the calculation of overtime rates. However, they will only be given half of that rate for every overtime hour.
For example, let’s say an employee works 45 hours a week at a rate of $10/hour and receives $100 in commissions for that week. We need to first calculate the new regular hourly rate.
To do so:
(Total hours x Hourly Rate) + Commission
= (45 x 10) + 100
= $550 (new regular hourly rate)
Then, divide that by the total hours worked in the week.
= 550 / 45
To determine the overtime rate for the commissioned employees, we need to take that new regular hourly rate and halve it.
$12.22 / 2
= $6.11 (commissioned employees’ overtime rate)
Since the employee worked an extra 5 hours in the week, that makes his overtime compensation $30.56 ($6.11 x 5 hours).
The amount will vary according to the hours worked, hourly rate, and commission earned.
The Ohio Senate recently passed a bill, effective from July 6, 2022, that exempts certain occupations from overtime requirements. This includes:
- Employees of businesses earning less than $150,000 in yearly gross sales
- Agricultural workers
- Casual babysitters
- Live-in caretakers
- Recreational camp staff
- Public employees
- Administrative, professional, or executive employees
Ohio law sets the statute of limitations at 2 years for unpaid wage claims. Employees have only these 2 years to file a claim or lawsuit in court to be able to receive compensation for unclaimed overtime hours.
There are some exceptions to Ohio’s statute of limitations that may differ depending on the circumstances found in each case. The statute of limitations can be extended if:
- Defendant (accused) is Out of State – If the defendant has left Ohio during the 2 years, the statute of limitations will be delayed until they return. Their absence will not be considered in those 2 years.
- Mental Disability – If the person who makes the claim is not deemed mentally competent due to mental illness, the statute of limitations will be extended until after the matter is resolved.
- Underage – If the person who makes the claim is under the age of 18, the statute of limitations will only begin once they have turned 18.
If an employer has misclassified employees as exempt (not eligible) from overtime, they may be entitled to a good amount of unpaid overtime compensation.
Employees can be entitled to damages that date as far back as 3 years.
It is advisable to consult with an attorney regarding employee misclassification as penalties may vary based on the severity of the case.
Below, we present law cases relating to fair overtime compensation for employees in Ohio:
1. Home Care Provider Charged With $19,934 for Multiple FLSA Violations
In 2023, Ephiphany Home Care @ Best, LLC was found to be in violation of the Fair Labor Standards Act (FLSA) for failure to compensate its employees for their overtime hours. The homecare owner, ShaRonda Moore, was ordered to pay a sum of $19,934 in back wages and additional damages to 7 employees, after an investigation by the U.S. Department of Labor (DOL).
The employees were health aides who provide services to clients in the comfort of their own homes. As they were in-home workers, they were not compensated for the times that a client’s needs had interrupted their sleep. The DOL investigated and also found that Ephiphany had not combined the work hours of employees who worked in multiple locations. Besides that, Ephiphany had also mistakenly exempted a manager from overtime pay.
The court-mandated sum of $19,934 to be paid by Ephiphany included $9,967 of back wages to employees and an additional $9,967 in liquidated damages.
The court also ordered Ephiphany to pay for any of the employees’ legal fees.
Key lessons from this case:
- Home healthcare providers must accurately keep track of their employees’ hours to avoid failure to compensate for overtime.
- Mistakenly exempting employees from overtime pay can lead to legal repercussions. Employers should carefully review and classify employees’ job roles including managers to ensure compliance with overtime pay requirements.
- The case emphasizes the need to consider any unique circumstances related to the nature of the employee’s work.
- Employers who make repeated violations of FLSA are liable to face plenty of penalties, on top of back wages and damages. This should be a reminder for employers in Ohio to comply with the law to avoid such issues.
2. Construction Company to Pay $265K in Back Wages and Damages for Overtime Violations
The United States Department of Labor (DOL) filed a lawsuit against G.E.M Interiors, Inc. (GEM Interiors), a construction company, for violating the Fair Labor Standards Act (FLSA) when they failed to provide overtime compensation for their employees.
The DOL revealed that GEM Interiors used many different methods of denying their employees proper compensation for overtime pay. They had divided employees’ overtime hours by ⅓ and wrongly recorded it as overtime compensation on their payroll. Besides that, they had also misclassified their employees as independent contractors, in order to avoid providing overtime pay to them.
A settlement of $265,000 was proposed for the company to pay 182 employees. As part of the judgment, GEM Interiors had agreed to make such payments but in a 36-month installment starting from April 2023. It also face a total of $42,000 in civil damages for violation of FLSA.
To avoid such issues again, GEM Interiors had to make extra commitments stating that they will refrain from hiring workers as independent contractors and only hire those who are registered in the state of the work that is to be performed. They will also hire an auditor from a third-party company to review their records to ensure that they comply with FLSA moving forward.
Key lessons from this case:
- It is important to remember that misclassification of employees is illegal in Ohio and should be avoided by all employers.
- The employer was subjected to implement several “safety measures” such as hiring an auditor and avoiding the hire of independent contractors. This shows how important it is to ensure compliance with Ohio overtime laws.
- It is important to ensure proper overtime compensation calculations. In this case, the employer had purposely divided employees’ work hours by ⅓ to avoid paying an overtime rate. This is a violation of overtime laws.
3. Restaurant Owner Violates Overtime Laws by Forcing Servers to Return Wages
An investigation was conducted by the U.S. Department of Labor (DOL) into the business of restaurant owner Ruben Lopez and his restaurant Los Mariachis, LLC. It was found that the servers who worked at that restaurant were forced to give back their wages in cash form after receiving their paychecks. They were forced to only keep the tips they earned plus $20 in cash for every 2-week period.
Besides that, the cooks there were paid a straight salary for the 60-hour week they had worked, with no overtime rate calculation included. These actions taken by the employer are in serious violation of the Fair Labor Standards Act (FLSA). Not only that, but the employer did not keep accurate records of the hours worked by employees as well as payroll information as the law would require.
The DOL managed to recover $245,509 in back wages for the servers and cooks that were mistreated at the restaurant. The owner also complied with the federal wage laws immediately.
Key lessons from this case:
- It is important to know that an employer cannot force an employee to return the wages they receive. This is illegal and should be reported immediately.
- As the restaurant owner did, employers should rectify any violations caused by immediately complying with the wage laws and ensuring proper compensation is made.
- Servers and cooks are among those who are non-exempt. This means they are entitled to overtime pay.
Learn more about Ohio Labor Laws through our detailed guide.
Important Cautionary Note
When making this guide we have tried to make it accurate but we do not give any guarantee that the information provided is correct or up-to-date. We therefore strongly advise you seek advice from qualified professionals before acting on any information provided in this guide. We do not accept any liability for any damages or risks incurred for use of this guide.