The federal rule
Under the FLSA, non-exempt employees earn 1.5× their regular rate for hours over 40 in a workweek. Some states (California, for example) require double time beyond 12 hours in a day, and daily overtime after 8 hours.
The regular rate is not just the hourly wage
Bonuses, shift differentials and commissions are generally included when calculating the regular rate, which raises overtime pay. Paying overtime on the base wage alone is a common and expensive compliance error.
Who is exempt
- Salary basis plus executive, administrative or professional duties
- Threshold: $684/week federal (higher in some states)
- Commissioned retail employees have a separate exemption
- Misclassification is the most litigated payroll issue in the US
Budgeting for overtime
A 50-hour week at 22/hour costs 40 × 22 + 10 × 33 = 1,210, not 50 × 22 = 1,100. That 10% difference is why overtime-heavy operations need it modelled in the labour budget rather than discovered at payroll.
Frequently Asked Questions
Is overtime after 8 hours a day?
Federally no — it is after 40 hours per week. Several states require daily overtime.
Do salaried employees get overtime?
Only if non-exempt; exempt salaried staff generally do not.
Is double time required?
Only where state law says so (e.g. California beyond 12 hours).
Assumptions & disclaimer
Results are estimates for planning. Fee schedules, tax brackets and deduction limits change; confirm current figures with the marketplace, the IRS or a qualified accountant before making decisions. Nothing here is financial, tax or legal advice.
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