Overtime Regulations

By Entrepreneur Staff

Pencil

Overtime Regulations Definition:

The laws that regulate how to compensate employees for working in excess of a standard workweek

Excluding certain industry-specific exceptions, federal and state law requires that the nonexempt employees be paid when they work overtime. Nonexempt employees must be paid one-and-a-half times their normal rate of pay for hours worked in excess of 40 hours during a workweek. A workweek is defined as seven consecutive 24-hour periods. Although a workweek can begin on any day, it must be fixed for that employee and can't be changed so as to evade applicable overtime laws.

Most states have their own overtime laws, and if they're more favorable to employees, those are the ones you must follow. For example, under California law, employees who work more than eight hours during a single day are entitled to overtime, even if they don't work more than 40 hours during a given workweek (the federal requirement).

Remember, nonexempt employees can be salaried as well as hourly. So don't make the mistake of assuming that just because an employee is salaried, he or she is exempt from overtime.

More from Legal Issues

Fair Labor Standards Act

A federal law enforcing minimum standards that employers must abide by when hiring employees

See full definition

Family Medical Leave Act (FMLA)

The 1993 law that entitles a covered employee to take up to 12 weeks of leave in a 12-month period for the birth or adoption of a child or the serious health condition of the employee or the employee's child, spouse or parent

See full definition

Contracts

A legal document between parties that clearly spells out just what is expected and required of each party

See full definition

Americans With Disabilities Act (ADA)

A federal law enacted in 1990 that makes it illegal for employers with 15 or more employees to refuse to hire qualified people with disabilities if making "reasonable accommodations" would enable the person to carry out the duties of the job

See full definition

Latest Articles

Side Hustle

These Coworkers-Turned-Friends Started a Side Hustle on Amazon — Now It's a 'Full Hustle' Earning Over $20 Million a Year: 'Jump in With Both Feet'

Achal Patel and Russell Gong met at a large consulting firm and "bonded over a shared vision to create a mission-led company."

Side Hustle

How to Turn Your Hobby Into a Successful Business

A hobby, interest or charity project can turn into a money-making business if you know the right steps to take.

Business News

These Are the 10 Most Profitable Cities for Airbnb Hosts, According to a New Report

Here's where Airbnb property owners and hosts are making the most money.