Page 6 - White Paper- Wage and Hour Laws

Overtime Laws

Any employee who is not exempt from overtime laws (state and federal)

must be paid at one and a half times their regular rate for any hours worked in a

single week over 40. Penalties for getting this wrong can be significant: two or

three times the amount actually owed to the employee, plus payment of the

employee’s legal fees and costs if he or she wins a claim for unpaid overtime.

First, some terminology: an “exempt” employee is one who does not have to

be paid overtime, and a “non-exempt” employee is one who must be paid at one

and a half times their hourly rate for weekly hours over 40.

What you need to remember is that in order to be exempt from overtime, (i)

the employee must be paid on a salary basis and earn at least the threshold amount

per week (currently this is $455 per week, but that amount could change); and (ii)

their actual duties (i.e., what they really do all day, not necessarily what their title

is) fall within one of the “exemptions” under the overtime laws.

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