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UNPAID OVERTIME
US federal law usually requires employees who work more than 40 hours a week, to be paid overtime pay.
Overtime pay is calculated at the regular hourly rate of pay plus an additional 50 percent of that regular rate. Just because an employee is paid a weekly, bi-weekly and/or monthly salary does not necessarily mean the employee is not entitled to overtime pay. Some states have wage and hour requirements for employers different from federal law.
To be ineligible for overtime, an employee must be in an exempt classification. Exempt classifications apply to executive, administrative, or professional employees. To qualify for an exemption from overtime pay requirements under these categories, the employee must generally pass a two-pronged test consisting of: 1) a salary basis test, and 2) a duties test.
In most cases, a salary test is met if the employee is paid a fixed amount of money weekly, bi-weekly and/or monthly, and there is no deduction from this fixed rate based on the quantity or quality of the work.
A duties test is different for executive, administrative and professional employees.
The duties test is met by the actual work being done as opposed to "job titles" or written "job descriptions."
To Be Exempt as an Executive Employee, a Person Must:
- usually direct the work of two or more other full-time employees;
- have management as his/her "primary duty;"
- have the authority to hire and fire;
- be able to exercise discretionary powers;
- spend no more than 20% of his/her hours in the workweek in activities not directly and closely related to the above duties, or 40% in a retail or service establishment/
- be paid on a "salary" basis.
To Be Exempt as an Administrative Employee, a Person Must:
- have as his/her "primary duty;"
- office or nonmanual work directly related to management policies or general business operations; or
- work in educational administration, which work is directly related to academic instruction or training
- usually exercising discretionary and independent judgment;
- (i) regularly and directly assist a bona fide executive or administrative employees; or
(ii) perform under only general supervision work that is specialized or technical and that requires special training, experience, or knowledge; or
(iii) perform special assignments or tasks under only general supervision;
- spend no more than 20% of his/her hours in the workweek in activities not directly and closely related to the above duties, or 40% in a retail or service establishment; and
- be paid "on a salary basis."
To Be Exempt from overtime pay as a Professional Employee, a Person Must:
- have as his/her primary duty work which requires:
- advanced knowledge customarily requiring extensive education; or
- originality and creativity in a recognized artistic field; or
- teaching or otherwise imparting knowledge as a teacher in a school or in an academic or educational institution; or
- theoretical and practical application of highly specialized knowledge in computer systems analysis, programming, and software engineering in a computer/software occupation;
- consistently exercise discretion and judgment;
- perform work which is predominantly intellectual and varied, and which cannot be standardized in relation to a given period of time.
- spend no more than 20% of his/her hours in the week in activities not essential and necessarily incidental to the above duties; and
- be paid on "a salary basis."
Off Clock Work
If you are a non-exempt employee (usually an hourly employee), and your employer requires you to work "off the clock," you may be entitled to overtime compensation. Some examples of working "off the clock" are the following, but there are many, many more examples:
- Manager requires you to complete a task before leaving work but complains it is taking too long and requires you clock out while requiring you to complete that task before leaving.
- Uniforms are required and changed at work before a person clocks in and changed after a person clocks out.
OVERTIME NEWS
Bay Street cringes as a series of class actions over unpaid overtime send companies scrambling to see if they are compliant. (Mar-02-08) LAW TIMES: UNPAID OVERTIME
Bank of Nova Scotia faces class action lawsuit regarding overtime pay for thousands of former non-management, non-unionized employees who were or are personal pankers or other service employees. (Dec-10-07) [CANADIAN PRESS: UNPAID OVERTIME]
Walmart, claiming payroll processing errors, will pay nearly $4 million in overtime wages to 50,000 workers throughout California as part of a settlement reached between Walmart and the California Labor Commission. (Aug-14-07) KPBS: UNPAID OVERTIME
A former sales rep is suing IBM for unpaid overtime and other benefits in a class action suit that could leave the computer maker on the hook for more than $5 million in back wages. (Jul-24-07) INFORMATION WEEK: UNPAID OVERTIME
A tentative agreement has been reached in a class action lawsuit that accused La Esperanza Mercado Carniceria of failing to pay employees for overtime. (Jun-26-07) [SANTA CRUZ SENTINEL: UNPAID OVERTIME]
Some unscrupulous employers are mistreating their immigrant workers by denying legally protected wages and breaks. (May-17-07) LAS: UNPAID OVERTIME
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