How is Overtime Pay Calculated and When Do You Get It?

Most employers in California hopefully know that they have to, by law, pay their employees for the hours those employees work. But where most employees get into trouble is when overtime comes into play. Many employees and employers don’t understand how overtime works, or how to calculate overtime pay.

How Much is Owed?

The amount of overtime pay is relatively simple—an employee must get time and a half for every hour of overtime worked. So, if an employee makes $20 normally, the employer would make $30 ($20 + $10) for every overtime hour.

Counting the Hours

What isn’t so simple, is determining when overtime “kicks in,” that is, what hours actually count as overtime. This can be confusing because federal laws and California laws are different.

Under federal law, any time worked over 40 hours a week counts as overtime. Note the “per week” part of that—that means it doesn’t matter how long or how many hours you work in a given day, what matters is what your total hours are at the end of the week.

Your employer cannot average two (or more) weeks to try to come up with a number that is less than 40 hours. It does not matter when the workweek starts or begins, so long as 40 hours is not exceeded in a 7 day period.

But many states, including California, work a bit differently. They calculate 40 hours based on a daily 8 hour workday. That means that if you work more than 8 hours in a given day, the requirement to pay overtime kicks in—even if you never hit the 40 hour threshold in that given week.

Salaried Employees

Many employees don’t work on an hourly salary—they simply receive a set salary. To be protected by the federal laws, you must earn what comes to less than $455 weekly. Your salary must remain the same, even if you miss work and regardless of performance, for you to be a salaried employee.

Many employers make this mistake—they may pay you salary above the threshold limit, and thus, not have to comply with the FLSA’s overtime pay requirements. But then they dock your pay every time you are late, or for not meeting a sales goal or because you took a day off—and by doing some they may have transformed you from an exempt salaried employee to a nonexempt employee who is in fact protected by the FLSA.

Note that even if an employee makes less than $455 weekly, if the employee falls into another category that is considered exempt from the FLSA—such as, for example, managerial or professional positions, and even some computer professionals, the employee still won’t be protected by the laws.

Are you owed money from your employer for hours or overtime hours worked? Contact the San Jose employment lawyers at the Costanzo Law Firm today.

Sources:

dol.gov/agencies/whd/overtime#:~:text=The%20federal%20overtime%20provisions%20are,their%20regular%20rates%20of%20pay.

dol.gov/agencies/whd/fact-sheets/23-flsa-overtime-pay