Overtime
Wages owed at 1.5× the regular rate of pay for hours worked over 40 in a defined seven-day workweek (federal rule).
Overtime under the federal Fair Labor Standards Act is wages owed at 1.5× the regular rate of pay for hours worked over 40 in a defined seven-day workweek. The workweek is a fixed, recurring 168-hour period chosen by the employer; once chosen, it cannot be changed every pay period to minimize overtime. Overtime cannot be averaged across workweeks — working 30 hours one week and 50 the next still produces 10 hours of overtime in the second workweek.
The regular rate of pay is not just the hourly wage. It includes most non-discretionary bonuses, shift differentials, on-call pay, and commissions earned during the workweek. A non-exempt employee who earns a $100 production bonus in a 50-hour workweek has the bonus apportioned across the 50 hours ($2/hour) before computing overtime — which adds $10 of overtime owed on top of the bonus.
Several states have stricter overtime rules: California (daily over 8, double-time over 12), Alaska (daily over 8), Colorado (daily over 12 and weekly over 40), Nevada (daily over 8 for low-wage workers), Kentucky (weekly over 40 with seventh-consecutive-day premium), Minnesota (weekly over 48). When state and federal rules conflict, the rule more favorable to the employee controls.
See the overtime calculation guide for the full mechanics.