Unpaid Overtime Hours

Overtime is when an employee works more than a certain amount of hours in a week. Overtime pay is paid at a higher rate than daily pay for all hours worked. Hourly workers must be paid 1.5 times their usual hourly rate for jobs over 40 hours per week.

At the start of 2020, the Department of Labor introduced new regulations that increased the exemption wage standard from $455 to $684 a week. If you are under this bracket, this is how you calculate unpaid overtime:

Validate Nonexempt Status

Verify that your job is classified as nonexempt and that it is not exempt from the FLSA's minimum wage and overtime pay requirements. The following tests verify the exempt or nonexempt status: job duties, wage level, and salary basis. To be considered excluded, you must pass all three examinations. Otherwise, your work is considered nonexempt, which means you should be paid overtime.
Validating the nonexempt status of employees is crucial to ensure compliance with labor laws, particularly regarding overtime pay eligibility. Here are some steps to validate nonexempt status:
  • Review Job Duties and Responsibilities: Examine the duties and responsibilities of the position to determine if they primarily involve routine or manual tasks, administrative work, or supervision of other employees. Nonexempt employees typically perform hourly work that is not exempt from overtime pay requirements.
  • Check FLSA Exemptions: Familiarize yourself with the Fair Labor Standards Act (FLSA) exemptions, which include executive, administrative, professional, computer, and outside sales exemptions. Ensure that the employee's job duties meet the criteria outlined for nonexempt status under the FLSA.
  • Consider State Laws: Be aware of any state-specific labor laws that may differ from federal regulations regarding overtime pay eligibility and nonexempt status. Some states have more stringent requirements than the FLSA.
  • Review Compensation Structure: Evaluate how the employee is compensated to ensure compliance with minimum wage and overtime pay requirements. Nonexempt employees are typically paid an hourly rate and are entitled to overtime pay for hours worked over 40 in a workweek.
  • Assess Supervisory Duties: Determine if the employee has supervisory responsibilities over other employees. Nonexempt employees typically do not have significant authority or decision-making power over other employees, as this may qualify them for exempt status under certain exemptions.
  • Document Job Descriptions: Maintain detailed job descriptions for all positions within the organization, clearly outlining the duties, responsibilities, and qualifications required for each role. This documentation can help support the classification of employees as nonexempt or exempt.
  • Consult Legal Counsel or HR Professionals: Seek guidance from legal counsel or human resources professionals to ensure that your classification decisions align with applicable labor laws and regulations. They can provide expertise and assistance in evaluating nonexempt status and addressing any compliance issues.
  • Conduct Regular Audits: Periodically review and audit employee classifications to ensure ongoing compliance with labor laws and regulations. Changes in job duties or responsibilities may affect an employee's nonexempt status over time.
  • Provide Training and Education: Educate managers, supervisors, and HR staff on the criteria for determining nonexempt status and the importance of accurate classification to avoid potential legal risks and penalties.
  • Document Classification Decisions: Maintain records documenting the rationale behind classification decisions, including job descriptions, duties assessments, and any relevant legal guidance or consultations.

By following these steps and ensuring that employees are accurately classified as nonexempt or exempt, organizations can mitigate the risk of noncompliance with labor laws and protect the rights of their employees.

Reasons for Falling Under the Exempt Category

Some workers are deemed excluded from earning overtime pay due to the nature of their jobs. An employee must have particular categories of job duties to be counted as excluded.
Employees falling under the exempt category are typically exempt from certain provisions of the Fair Labor Standards Act (FLSA), such as overtime pay requirements. Here are common reasons why employees may fall under the exempt category:
  • Executive Exemption: Employees who primarily manage the enterprise or a recognized department or subdivision, supervise at least two full-time employees, and have authority to hire or fire employees or make significant recommendations regarding personnel decisions may qualify for the executive exemption.
  • Administrative Exemption: Employees whose primary duty involves office or non-manual work directly related to the management or general business operations of the employer or the employer's customers may qualify for the administrative exemption. This can include tasks such as finance, human resources, or marketing.
  • Professional Exemption: Employees who perform work requiring advanced knowledge in a field of science or learning, which is customarily acquired through prolonged specialized education and involves independent judgment or discretion, may qualify for the professional exemption. This includes professions such as lawyers, doctors, engineers, and teachers.
  • Computer Employee Exemption: Employees who primarily engage in computer-related work, including systems analysis, programming, or software engineering, and are paid at least a certain minimum salary threshold may qualify for the computer employee exemption.
  • Outside Sales Exemption: Employees who regularly work away from the employer's place of business and whose primary duty involves making sales or obtaining orders or contracts for services may qualify for the outside sales exemption.
  • Highly Compensated Employee Exemption: Employees who earn above a certain compensation threshold and perform some exempt duties may qualify for the highly compensated employee exemption. This exemption is designed for employees with a high level of responsibility or specialized skills who may not fit neatly into other exempt categories.
  • Creative Professional Exemption: Employees in certain creative fields, such as writers, musicians, or graphic designers, who perform work that requires invention, imagination, originality, or talent may qualify for the creative professional exemption.
It's important for employers to carefully evaluate whether employees meet the criteria for exempt status under the FLSA and other applicable labor laws. Misclassification of employees can lead to legal risks, including back pay liability for unpaid overtime wages and penalties for noncompliance. Consulting with legal counsel or HR professionals can help ensure accurate classification and compliance with relevant regulations.

Executive, managerial, technical, outside sales, and some machine workers are excluded under the Fair Labor Standards Act (FLSA). The exempt status will be determined on a case-by-case basis and is not dependent on the employee's work title.

Calculate Overtime Hours

Calculate unpaid overtime hours over the past couple of years. Include as much supporting evidence as possible, such as pay stubs and timesheets, to back up your point. It will show the exact dates and periods when your overtime hours were not paid properly, as well as the amount of pay you received for these hours if any.

Determine the Overtime Pay

The amount of overtime paid to each employee in a pay period is known as overtime pay. Overtime pay is determined as follows: hourly pay rate multiplied by 1.5 times the number of overtime hours worked, that is,
  • Regular pay = Regular pay rate x 40 hours
  • Overtime pay = regular pay rate x 1.5 x overtime hours
  • Total pay = Regular pay + Overtime pay


Overall compensation for a worker who worked 45 hours per week:
  • Regular rate is $20; overtime is 5 hours
  • Regular pay = $20 x 40 = $800
  • Overtime pay = $20 x 1.5 x 5 = $150

Approach Your HR Department

If there's a difference between the OT pay you calculated and the paid amount, speak with the human resources department. The unpaid amount of overtime compensation you are owed for hours worked may be processed automatically via the company's payroll system after your timesheet information has been reviewed and verified. If the boss objects to the details you've submitted, you'll need to hire a lawyer.

File a Complaint

Hire a competent employment law attorney to make a lawsuit on your behalf for unpaid overtime pay. When the case is about to close, you should wait for the judge's final decision.

If you win the case, your employer would be responsible for compensating you for the disparity between what you were paid and what you should have received.

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