What is the FLSA?
The Fair Labor Standards Act (FLSA) is the primary federal law governing wages and hours in the United States. Enacted in 1938 and administered by the Department of Labor's Wage and Hour Division (WHD), it establishes rules for minimum wage, overtime pay, recordkeeping, and child labour standards.
What are the FLSA overtime requirements?
The FLSA requires that non-exempt employees receive overtime pay of at least 1.5 times their regular rate of pay (commonly called "time and a half") for all hours worked over 40 in a single workweek.
Key points:
- Workweek basis: Overtime is calculated per workweek (a fixed, recurring 168-hour period or 7 consecutive 24-hour periods). Employers cannot average hours across multiple weeks.
- No daily overtime at federal level: The FLSA does not require overtime for working more than 8 hours in a single day. However, some states (notably California) do have daily overtime requirements.
- No double-time at federal level: The FLSA does not require double-time pay. Some state laws or union contracts may require it.
- No cap on hours: The FLSA does not limit the number of hours an adult employee can work in a week, only that overtime must be paid for hours exceeding 40.
How is the "regular rate of pay" calculated?
The regular rate includes more than just the hourly rate. It encompasses:
- Base hourly rate or salary equivalent
- Non-discretionary bonuses
- Shift differentials
- Commissions
- Piece-rate earnings
The regular rate excludes:
- Discretionary bonuses
- Gifts and special occasion payments
- Employer contributions to benefit plans
- Vacation, holiday, or sick pay
- Overtime premium payments already made
Example: An employee earns $20/hour and receives a $200 non-discretionary bonus in a week where they work 45 hours.
- Regular rate = ($800 base + $200 bonus) / 45 hours = $22.22/hour
- Overtime premium = $22.22 x 0.5 x 5 overtime hours = $55.56
- Total pay = $1,000 base + $200 bonus + $55.56 overtime premium = $1,255.56
Who is exempt from FLSA overtime?
Certain employees are classified as "exempt" and are not entitled to overtime pay. The most common exemptions require all three of the following:
- Salary basis test: The employee is paid a predetermined, fixed salary that is not subject to reduction based on the quality or quantity of work
- Salary level test: The employee earns at least $844 per week ($43,888 per year) as of July 2024
- Duties test: The employee's primary duties fall within one of the exempt categories:
- Executive: Manages the enterprise or a department, directs the work of at least two full-time employees, has authority to hire/fire
- Administrative: Performs office or non-manual work related to management or business operations, exercises independent judgement on significant matters
- Professional: Performs work requiring advanced knowledge in a field of science or learning, or original and creative work in a recognised artistic field
- Computer employee: Systems analyst, programmer, software engineer, or similar role earning at least $844/week or $27.63/hour
- Outside sales: Makes sales or obtains orders away from the employer's place of business
What are common FLSA overtime violations?
- Misclassifying employees as exempt when their duties do not meet the duties test
- Not paying for all hours worked, including time spent on work-related tasks before or after scheduled shifts
- Averaging hours across two workweeks to avoid overtime thresholds
- Offering compensatory time off instead of overtime pay (only permitted for public sector employers)
- Automatically deducting meal breaks when employees work through them
What are the penalties for FLSA overtime violations?
Employers who violate FLSA overtime rules may face:
- Back pay: All unpaid overtime owed, typically going back 2 years (or 3 years for wilful violations)
- Liquidated damages: An additional amount equal to the back pay
- Civil penalties: Up to $2,451 per violation for repeated or wilful violations
- Criminal penalties: Fines up to $10,000 and imprisonment for wilful violations
How Grove HR Helps
Grove HR tracks employee hours against the 40-hour weekly threshold, calculates the regular rate including non-discretionary bonuses and shift differentials, and flags potential overtime before it occurs. The system maintains FLSA-compliant time records and generates audit reports for DOL inspections.
Frequently Asked Questions
Can an employer require overtime work?
Yes. The FLSA does not limit the number of hours an employer can require an adult employee to work, nor does it require consent for overtime. The employer must simply pay the overtime premium for all hours worked over 40 in a workweek.
Can salaried employees receive overtime?
Yes. Being paid a salary does not automatically make an employee exempt from overtime. Only employees who meet all three tests (salary basis, salary level, and duties) are exempt. A salaried employee who earns less than $844 per week or whose duties do not meet an exemption category is entitled to overtime.
Does travel time count towards the 40-hour overtime threshold?
It depends. Normal commuting time is not compensable. However, travel during the workday (such as between job sites) and overnight travel during normal working hours are generally considered compensable work time under the FLSA.
Rachel Richardson
Head of Growth & Marketing, Grove HR
Rachel leads growth and marketing at Grove HR, with over a decade of experience in UK HR technology. She writes practical guides to help small businesses navigate employment law and build better workplaces.