Most employees in the United States are eligible for overtime compensation, regardless of the number of hours they are scheduled to work. This eligibility is determined by the nature of the job itself, not by the designation of “part-time” or “full-time” assigned by the employer. Understanding the federal standard for calculating hours and pay reveals that a worker’s status as part-time does not negate their entitlement to premium pay when they work beyond a certain threshold.
Defining Overtime Under Federal Law
The Fair Labor Standards Act (FLSA) establishes the national standard for overtime pay for eligible workers. This federal mandate requires that an employee receive compensation at a rate not less than one and one-half times their regular rate of pay for all hours worked over 40 in a single workweek. The FLSA defines a workweek as a fixed and regularly recurring period of 168 hours, consisting of seven consecutive 24-hour periods. This workweek does not have to align with the calendar week and can begin on any day or at any hour established by the employer.
Federal wage law operates strictly on this 168-hour workweek, and averaging hours worked over multiple weeks is not permitted for overtime calculation. The law focuses solely on the total time accumulated during that fixed, seven-day period.
Why “Part-Time” Does Not Mean “Overtime Exempt”
The designation of an employee as “part-time” is an administrative label used by companies, often to determine eligibility for benefits like health insurance or paid time off. This internal company classification has no standing in federal wage law regarding overtime eligibility. Federal law does not recognize a separate legal class of non-exempt workers called “part-time employees” who are treated differently under the FLSA.
The employer’s designation of the position as part-time is superseded by the FLSA’s requirement to pay premium wages for all hours exceeding 40. Eligibility for overtime rests entirely on whether the employee is considered “non-exempt” under the law, a status that applies to most hourly workers.
Key Exemptions That Affect Eligibility
While most employees are non-exempt and eligible for overtime, some roles are exempt from the FLSA’s overtime requirements. These exceptions cover bona fide Executive, Administrative, and Professional employees. To qualify for one of these exemptions, a worker must satisfy three distinct tests: a salary basis test, a salary level test, and a duties test. Meeting all three criteria is a strict requirement for the exemption to apply.
The salary level test currently requires the employee be paid a fixed salary of at least $684 per week, which equates to $35,568 annually. The duties test focuses on the employee’s primary job function, not their title.
Executive Exemption
An exempt Executive employee must have the primary duty of managing the enterprise or a recognized department and customarily direct the work of at least two or more full-time employees.
Administrative Exemption
This exemption requires the primary duty to be the performance of office or non-manual work directly related to the management or general business operations of the employer or its customers.
Professional Exemption
This generally covers work requiring advanced knowledge, typically acquired through specialized intellectual instruction, or work requiring invention, imagination, or talent in a recognized artistic field. An additional exemption exists for outside sales employees, which does not have a salary requirement but strictly limits the work to making sales or taking orders away from the employer’s place of business.
How Overtime is Calculated
Overtime compensation is calculated based on the employee’s “regular rate of pay,” which is the hourly average of all remuneration paid to the employee in the workweek, excluding certain statutory exclusions. This means that non-discretionary payments, such as production bonuses, attendance incentives, and certain commissions, must be included in this calculation.
To determine the regular rate, the employer must divide the employee’s total weekly compensation by the total number of hours actually worked. The overtime rate is then calculated by multiplying the regular rate by 1.5. For example, if an employee earns a total of $500 for 40 hours of work, their regular rate is $12.50 per hour, and their overtime rate is $18.75 per hour. If they work 45 hours, the five overtime hours are paid at $18.75, in addition to the straight time pay for all 45 hours.
When State Laws Change the Rules
While the FLSA sets the minimum national standard, state laws can provide greater protection for employees, and the more generous law always applies. Several states have established rules for daily overtime, which mandate premium pay for hours worked over a set limit in a single day, regardless of the weekly total. For example, in states like California, an employee may be entitled to time-and-a-half pay for any hours exceeding eight in one workday.
California law also introduces a double-time requirement, mandating payment at twice the regular rate for hours worked over 12 in a single day. Furthermore, some states have specific provisions for “seventh-day overtime,” requiring time-and-a-half pay for the first eight hours worked on the seventh consecutive day of a workweek. These state-level rules function as a layer of protection that often triggers overtime pay sooner than the federal 40-hour threshold. Employers must follow the rule that results in the higher pay for the employee.
Steps to Take for Unpaid Wages
If an employee believes they have been incorrectly denied overtime pay, the first action should be to document all hours worked and all compensation received. Maintaining detailed personal records, such as time logs, emails, and pay stubs, is important for substantiating a claim. The employee should then consider raising the issue directly with the employer or the payroll department in writing, as the discrepancy may be a simple error that can be easily corrected.
If the employer refuses to correct the issue, the employee can file a formal wage claim with the appropriate government agency. This can be done through the state’s Department of Labor or the federal Wage and Hour Division (WHD) of the U.S. Department of Labor. The WHD will launch an investigation, and the employer is prohibited from retaliating against the worker for filing a complaint or cooperating with the investigation. Statutes of limitations for wage claims vary, but the FLSA generally allows for the recovery of back wages for two years, or three years in cases of willful violation.