FLSA Overtime Pay Calculator
Use this calculator to estimate overtime pay according to the Fair Labor Standards Act (FLSA) for non-exempt employees. The FLSA generally requires employers to pay non-exempt employees at least one and one-half times their regular rate of pay for all hours worked over 40 in a workweek. The "regular rate of pay" includes most forms of compensation, such as hourly wages, non-discretionary bonuses, and shift differentials.
Understanding FLSA Overtime
The Fair Labor Standards Act (FLSA) is a federal law that establishes minimum wage, overtime pay, recordkeeping, and child labor standards affecting full-time and part-time workers in the private sector and in Federal, State, and local governments.
Who is Covered?
Most employees are covered by the FLSA. However, the law distinguishes between "exempt" and "non-exempt" employees. Exempt employees (e.g., certain executive, administrative, professional, and outside sales employees who meet specific salary and duties tests) are not entitled to overtime pay. Non-exempt employees, regardless of how they are paid (hourly, salary, commission), must receive overtime pay.
The "Regular Rate of Pay"
Overtime is calculated at 1.5 times an employee's "regular rate of pay." This is not simply the employee's hourly wage. The regular rate includes nearly all forms of compensation paid to an employee for a workweek, such as:
- Hourly wages
- Non-discretionary bonuses (bonuses promised for meeting certain criteria)
- Commissions
- Shift differentials
- Production bonuses
It generally excludes certain payments like gifts, discretionary bonuses, payments for time not worked (e.g., vacation, holidays), and expense reimbursements.
Calculating the Regular Rate:
- For Hourly Employees: The regular rate is calculated by dividing the total compensation (including wages, non-discretionary bonuses, etc.) for the workweek by the total hours worked in that workweek.
- For Salaried Non-Exempt Employees: If a salary is intended to compensate for a fixed number of hours (e.g., 40 hours), the regular rate is found by dividing the weekly salary (plus any other includable compensation) by that fixed number of hours (e.g., 40). For hours worked over 40, the employee is then due an additional half-time rate.
Overtime Pay Calculation:
For every hour worked over 40 in a workweek, a non-exempt employee must be paid an additional half of their regular rate of pay. This is because their straight-time pay for all hours worked (including overtime hours) is already accounted for in their regular wages or salary. The "time and a half" refers to the additional half-time premium.
Example Scenario:
An hourly non-exempt employee earns $15/hour and works 45 hours in a week. They also receive a $50 non-discretionary bonus for that week.
- Total Straight Time Earnings: (45 hours * $15/hour) = $675
- Total Compensation for Regular Rate: $675 (wages) + $50 (bonus) = $725
- Regular Rate of Pay: $725 / 45 hours = $16.11 per hour (approximately)
- Overtime Hours: 45 – 40 = 5 hours
- Overtime Premium Pay: 5 hours * $16.11 * 0.5 = $40.28
- Total Weekly Pay: $725 (straight time + bonus) + $40.28 (overtime premium) = $765.28
Disclaimer: This calculator provides estimates based on general FLSA guidelines. State laws may have different or additional requirements. Consult with a legal professional or HR expert for specific advice regarding your situation.