Employment Law » Employment Law: When Must Employers Pay Overtime?

Employment Law: When Must Employers Pay Overtime?

Federal and state employment laws stipulate that employers should their workers’ overtime based on certain circumstances. The overtime premium is usually 50% of the employee’s regular hourly wage. That means that an employee who works overtime must be paid their usual hourly wage plus the 50% overtime premium for every overtime hour they work.

However, overtime laws have exemptions, so not every employee is entitled to overtime pay. Eligible employees are known as non-exempt employees, and those who are not eligible are called exempt employees. As a non-exempt employee, if your employer is not paying the overtime you are legally entitled to, you may wish to seek the guidance of a texas overtime attorney to help you explore your legal options.

The weekly VS daily overtime standard

Many state laws impose a weekly overtime standard. That means non-exempt employees are entitled to overtime pay for every hour beyond 40 that they work in a workweek despite how many hours they work in a day. Suppose you work 12hours on Monday and 6hours on Tuesday then you don’t work any more hours the rest of the week. In that case, you are not eligible for overtime under the weekly standard because your working hours are below 40.

Some states use the daily overtime standard law. That means every non-exempt worker is eligible for overtime for every hour beyond 8hours they work in a day. In the example stated above, you would qualify for 4hours overtime on Monday under the daily overtime standard even though you didn’t work for more than 40hours a week.

Which employers must pay overtime?

The biggest percentage of employers must pay overtime, but not all of them should. A company must pay its workers overtime if it is covered by the federal Fair Labor Standards Act (FLSA). FSLA covers companies that get $500,000 in yearly sales or more. Even if the company is smaller, it must pay overtime if they conduct interstate commerce or business between states. That includes making phone calls or sending emails out of state, or handling goods coming from or going out of state. That means regardless of how small a business is, it might be covered by the state overtime laws.

Which employees are eligible for overtime?

If the company is under FSLA, all employees are eligible for overtime unless they are exempt workers. Some of the exempt workers not eligible for overtime include:

  • Independent contractors.
  • Volunteer workers.
  • Administrative, executive, and professional workers paid on a salary basis.
  • Certain computer specialists like programmers who earn $27.63 per hour.
  • Workers engaged n fishing operations.
  • Criminal investigators.
  • Casual domestic babysitters.
  • Employees working on small firms etc

Overtime laws differ from one state to another, and some states have additional rules that make it challenging to determine the exemptions. So as an employer, it is best to check with your state laws before qualifying an employee as an exempt worker.


As an employee, if you feel you are not receiving your rightful overtime pay, you should ask your human resource department or employer or contact an overtime attorney if that doesn’t work.

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