Overtime must be compensated at a rate of at least one and one-half times the employee's regular rate of pay for each hour worked in a workweek in excess of the maximum allowable in a given type of employment. Generally, the regular rate includes all payments made by the employer to or on behalf of the employee (except for certain statutory exclusions). The following examples are based on a maximum 40-hour workweek.
Hourly Rate
If more than 40 hours are worked by an employee paid by the hour, at least one and one-half times the regular rate for each hour over 40 is due. Example: An employee paid $20 an hour works 44 hours in a workweek. The employee is entitled to at least one and one-half times $20 (i.e., at least $30) for each hour over 40. Pay for the week would be $800 for the first 40 hours, plus $120 for the four hours of overtime-a total of $920.
Salary
The regular rate for an employee paid a salary for a regular or specified number of hours a week is obtained by dividing the salary by the number of hours for which the salary is intended to compensate.
If, under the employment agreement, a salary sufficient to meet the minimum wage requirement in every workweek is paid as straight time for whatever number of hours are worked in a workweek, the regular rate is obtained by dividing the salary by the number of hours worked each week. To illustrate, suppose an employee's hours of work vary each week, and the agreement with the employer is that the employee will be paid $1000 a week for whatever number of hours of work are required. Under this agreement, the regular rate will vary in overtime weeks. If the employee works 50 hours in the week, the regular rate is $20 ($1000 divided by 50 hours). In addition to the salary, one and one-half the regular rate, or $30 is due for each of the 10 overtime hours, for a total of $1300 for the week. If the employee works 60 hours, the regular rate is $16.67 ($1000 divided by 60 hours). In that case, an additional $25 is due for each of the 20 overtime hours, for a total of $1500 for the week.
If a salary is paid on other than a weekly basis, the weekly pay must be determined in order to compute the regular rate and over-time pay. If the salary is for a half month, it must be multiplied by 24 and the product divided by 52 weeks to get the weekly equivalent. A monthly salary should be multiplied by 12 and the product divided by 52.
Other Labor Laws
In addition to the federal minimum wage and overtime law, the Department of Labor administers a number of other labor laws that apply to the professional, executive, and technical temp worker. Among these are:
- The Family and Medical Leave Act, which entitles eligible employees of covered employers to take up to 12 weeks of unpaid job protected leave each year, with maintenance of group health insurance, for the birth and care of a child; for the placement of a child for adoption or foster care; for the care of a child, spouse, or parent with a serious health condition; or for the employee's serious health condition.
- The Employee Polygraph Protection Act, which prohibits most private employers from using any type of lie detector test either for pre-employment screening of job applicants or for testing current employees during the course of employment.
- The Wage Garnishment Law, which limits the amount of an individual's income that may be legally garnished and prohibits firing an employee whose pay is garnished for payment of a single debt.
- The Immigration and Nationality Act, as amended, which requires employers to verify the employment eligibility of all individuals hired and keep Immigration and Naturalization Service forms (I-9) on file for at least three years and for one year after an employee is terminated; under the D-l provisions, provides for the enforcement of employment conditions attested to by employers seeking to employ alien crew members to perform specified long shoring activity at U.S. ports; under the F-l provisions, provides for the enforcement of attestations by employers seeking to use aliens admitted as students in off-campus work; under the H-1A provisions, provides for the enforcement of employment conditions attested to by employers of H-1A temporary alien non-immigrant registered nurses; and under the H-IB provisions, provides for the enforcement of labor condition applications filed by employers wishing to employ aliens in specialty occupations and as fashion models of distinguished merit and ability.
The equal pay provisions of the federal minimum wage and overtime law prohibit sex-based wage differentials between men and women employed in the same establishment who perform jobs that require equal skill, effort, and responsibility and which are performed under similar working conditions. These provisions, as well as other statutes prohibiting discrimination in employment, are enforced by the Equal Employment Opportunity Commission. More detailed information is available from its offices, which are listed in most telephone directories under U.S. Government.
