Labor Law: Facts & Fiction – Overtime Compensation

PART 4 of a 9-part Series

OVERTIME COMPENSATION

Pursuant to the Fair Labor Standards Act (FLSA), every employer must establish a 7 day pay period such as Monday through Sunday or Saturday through Friday, regardless of whether the employee is paid daily, weekly, every 2 weeks or monthly.

The purpose of the Law is to determine a BASIS FOR OVERTIME COMPENSATION….So regardless of how often an employee gets paid, his or her overtime is still determined by the number of hours he or she worked during any 7 day pay period.

OVERTIME COMPENSATION is due and payable on the next regularly scheduled payday for the previous pay period in which an employee worked more than 40 hours during any work week of that pay period.

Additionally, there is no such thing as ”UNBILLABLE OVERTIME” which is a term some Day Labor and other similar type Temporary Agencies use to avoid paying their employees the proper overtime compensation required by the FLSA.

OVERTIME COMPENSATION is simply 1.5 (one and a half) times your “REGULAR RATE OF PAY” for each hour you worked over 40 hours in any 7day pay period, whether you worked for permanent employer or a temporary agency. 

If you are working for a temporary agency, it does not matter how many different clients the temporary agency sends you to during that 7 day pay period.  If you worked more than 40 hours for any one temporary agency, you are entitled to overtime compensation.  Even if that temporary agency is unable to bill or collect overtime from any of their clients you worked for during that 7 day pay period, they still must pay you the overtime….

JOHN WORKED 50 HOURS AT VARIOUS RATES OF PAY DURING A 7 DAY PAY PERIOD AND HIS TOTAL EARNINGS CAME TO $500.00….    THEREFORE, THE BASIS FOR HIS OVERTIME COMPENSATION WILL BE DETERMINED BY AVERAGING HIS TOTAL EARNINGS WHICH IS $350.00 AND DIVIDING IT BY 50 HOURS WHICH = $10.00 PER HOUR AVERAGE REGULAR RATE OF PAY X 1.5+ = $15 PER HOUR BASIS FOR OVERTIME COMPENSATION.

FURTHERMORE, IF YOUR EMPLOYER VERBALLY QUOTES YOU THAT YOUR REGULAR RATE OF PAY IS FOR EXAMPLE $10 PER HOUR BUT WHEN YOU GET YOUR paycheck/pay stub it shows that REGULAR RATE OF PAY WA $8.00 PER HOUR PLUS A “BONUS” OR “RETROACTIVE ADJUSTMENT” EQUALING ANOTHER $2.00 PER HOUR FOR A TOTAL OF $10.00 per hour, YOUR EMPLOYER IS REQUIRED TO PAY YOU 1.5 TIMES THE $10.00 per hours rate not 1.5 TIMES the $8.00 per hour rate WHEN DETERMINING OVERTIME COMPENSATION PURSUANT TO THE FLSA.

THE DESIGNERS OF THE FLSA KNEW THERE WOULD BE SOME EMPLOYERS WHO WOULD TRY TO “CHEAT” THEIR EMPLOYERS OUT OF THE PROPER OVERTIME COMPENSATION DUE BY USING “SWEAT SHOP” TACTICS AS EXAMPLED IN THE LAST PARAGRAPH, SO THEY MADE IT LAW THAT ANY “BONUSES” OR ANYTHING SOUNDING LIKE A “BONUS” SUCH AS “RETROACTIVE ADJUSTMENT” WHEN ADDED WOULD DETERMINE THE “REGULAR RATE OF PAY”.

Managers and Supervisors who are on a “salary” and not an “hourly wage” are exempt from overtime compensation no matter how many hours they work a week….Sorry Guys….!!!!

However Managers and Supervisors on “hourly wage” must be paid overtime compensation at 1.5 times their regular rate of pay for all hours worked over 40 in any 7 day work week.  Even if they receive bonuses, commissions or overrides on top of their “hourly wage”, the Labor Department advised me that they still must be paid “overtime compensation” for all hours worked over 40.

Additionally, any employee including Managers and Supervisors who are on an “hourly wage” who is either requested, required or expected to WORK AT HOME by their employer must be paid for that time at their “regular rate of pay” as well as “overtime compensation when applicable….

Furthermore, your time at home counts as hours worked during any 7 day work week….ONLY “SALARIED” MANAGERS OR SUPERVISORS ARE EXEMPT FROM THIS RULE…. 

Employees who are not Managers or Supervisors but who are on “salary” are not exempt and must be paid for overtime compensation or working at home.  In determining “overtime compensation” for “salaried employee” who are not Managers or Supervisor just simply divide the salary by the number of hours you are expected to work for that salary (but no more than 40) and that will determine the employee “regular rate of pay”….Then simply multiply the “regular rate of pay by 1.5 which will = “the amount of OVERTIME COMPENSATION you would be entitled to for all hours worked over 40 hours in any work week.

****PLEASE NOTE:  EMPLOYERS ARE NOT ONLY REQUIRED TO PAY EMPLOYEES FOR THE ACTUAL TIME THEY PERFORM ANY KIND OF WORK FOR THE EMPLOYER BUT FOR “WAITING TIME” AS WELL, AS LONG AS THAT WAITING TIME “BENEFITS” OR “PROFITS” THE EMPLOYER. 

THEREFORE, “EXIT INTERVIEWS” BENEFIT OR PROFIT THE EMPLOYER AS THE NATURE OF THESE “EXIT INTERVIEWS” ARE FACT FINDING IN NATURE TO FIND OUT WHAT POSITIVES AND NEGATIVES THE EMPLOYEE MIGHT HAVE EXPERIENCED WITH THE COMPANY, MANAGEMENT, SUPERVISORS, CO-WORKERS, AND THE EMPLOYEES REASONS FOR LEAVING ESPECIALLY IF THE EMPLOYEE QUIT RATHER THAN HAVING BEEN TERMINATED. 

IN ANY EVENT, IF IT BENEFITS OR PROFITS THE COMPANY BECAUSE WHAT THE EMPLOYEE TELLS THEM WILL HOPEFULLY HELP MAKE CHANGES FOR THE BETTER AND CREATE MORE PRODUCTIVITY FOR THE COMPANY IN THE FUTURE….  MORE PRODUCTIVITY = PROFITS….THE EMPLOYEE’S TIME IS MONEY JUST LIKE ANYONE ELSE’S….

ADDITIONALLY, THE FLSA DOES NOT REQUIRE AN EMPLOYEE WHO RESIGNS OR IS TERMINATED TO ATTEND AN “EXIT INTERVIEW” IN ORDER FOR THEM TO RECEIVE A “FINAL PAYCHECK”.  BUT IF THE EMPLOYEE DOES ATTEND AN EXIT INTERVIEW, THEY SHOULD BE PAID FOR IT….!!!!

Short URL: http://www.veteranstoday.com/?p=36534