Labor Law 101: Answering the Top 6 Questions About Overtime Pay

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Overtime pay is not a complicated process if companies follow the rules. Whether negligent or not, wage theft is a serious situation. Dealing with it immediately is always the best option, but sometimes it doesn’t work out that way. Don’t let a misunderstanding of overtime pay prevent you from dealing with potential problems. It’s money that is earned and always expected to be paid in full. 

6. Burnout Is Real

Overtime pay is a great way to add money without stepping outside of your comfort zone. Too much overtime will cause burnout. Employers have the right to refuse overtime requests from an employee that already has to much time put into work. A business has to protect its employees and working them into sick days doesn’t benefit the company. 

5. The Rate Is Set In Stone

Overtime (when not factoring in other variables) is one and half times the regular rate of pay. There is no negotiating for a lower rate, and there is no such thing as getting so much overtime that the pay is averaged out. It is illegal for an employer to ask an employee to work overtime at a special rate below what the state requires. 

4. Authorization Is Required

With all of that said, employees can’t decide to work overtime whenever they feel like it. An employee can deny requests for overtime if no prior authorization is given for the extra work. Even if you decide to stay for an hour after your schedule and put in extra work, without authorization you are just giving away time for free. 

3. Tips Change The Rules

Tipped employees are one of the variables that change how overtime pay is calculated. If you receive more than thirty a month in tips, then there are specific guidelines in how overtime is handled. Tips can be considered part of an employee’s wage, although this is not always the case. Whenever there is doubt about this, check to see if the employer takes a tip credit towards the minimum wage obligation. This is standard and may help you to figure out overtime percentages. 

2. Work Eligibility Changes The Rules

When a company deals with exempt or salaried employees, the language can sometimes create problems with overtime pay. Businesses will use this to their advantage and use the terms interchangeably with little repercussions. Understand your current work eligibility and the language behind it. Remember that not all businesses handle the salary the same way. 

1. When Different Rates Are Used

When you are paid per task (piecework) then overtime is calculated by adding 1.5 times the amount earned from the regular rate. This would be calculated by dividing the total weekly pay by the number of hours worked. On top of that, you also get the full earnings for piecework. That is a simple addition to the formula that is easy to overlook. 

Wrap Up

Almost eighty percent of people continue to work even after their shift is over. This can range from a few minutes to several hours. When you ignore unpaid overtime that accumulates, it is like giving up your time for free. Take control of the overtime narrative by understanding why you should be paid for all of your work.