The federal overtime law is called the Fair Labor Standards Act (“FLSA”) and it was enacted in 1938.  The FLSA sets forth the overtime pay requirements for employees.  Unfortunately, many employees are owed overtime pay and do not even know it. 

Overtime myths:

• Myth 1:  Salaried employees do not get overtime pay.  Perhaps the biggest overtime myth is that salaried employees are not entitled to overtime pay.  There are certain statutory exemptions for employees under the FLSA that do require an employee to be paid a salary in order to fall under the exemption, but salary is only one part of a multi-prong test in these instances.  If the other criteria for an exemption are not met, then the fact that an employee is paid on a salary alone will not keep the employee from being entitled to overtime.  The fact of the matter is that while there are many hourly employees who are entitled to overtime, there are also many salaried employees who are entitled to overtime as well. 

• Myth 2:  Compensatory time can be given in lieu of overtime pay.  Unless you are employed by a public employer, such as the local, state or federal government, your employer cannot give you compensatory time in lieu of overtime pay.  Private employers cannot even give their non-exempt employees a choice between overtime pay or compensatory time off under the FLSA.

• Myth 3:  Time spent traveling for work does not count towards hours worked for purposes of calculating overtime.  While time spent commuting to and from work is not considered part of the hours worked in calculating overtime pay, employee travel that is part of a normal workday, such as travel time to and from job sites or client meetings, is compensable work time and counts toward the calculation of total hours worked for purposes of calculating overtime.

• Myth 4:  Employees can give up their right to overtime pay.  The FLSA does not allow an employee who is entitled to overtime pay to “give up” or waive his or her right to overtime pay by agreement with the employer.  In other words, your employer is not off the hook for failing to pay you for overtime pay even if you and your employer entered into an agreement that you would not be entitled to overtime pay or that you would voluntarily waive your right to overtime pay. 

• Myth 5:  You are not entitled to overtime pay unless your supervisor expressly authorizes it.  Nearly all employees paid by the hour (and many employees who are paid a salary) are entitled to pay at 1.5 times their normal rate of pay for all overtime hours worked.  All work done above and beyond 40 hours in one week is eligible for overtime.  If your supervisor directs you to go home from work instead of working overtime, then you should do so or you could get disciplined or even terminated.  You are, however, entitled to overtime pay for all hours worked over 40 per workweek regardless of whether your supervisor authorized you to work overtime or not. 

• Myth 6:  Your employer may choose to pay you “straight time only” even if you work more than 40 hours per week.  The FLSA requires that all employers pay their employees 1.5 times the employee’s regular rate of pay for all hours worked in excess of 40 in any given workweek.  Almost no exceptions to this overtime law apply if you are an hourly employee.  This means that if you make $20.00 per hour, you should receive $30.00 per hour for all hours that you work in excess of 40 per week.

Overtime Exemptions:  Many employees are told by their employer that they are “exempt” from overtime (i.e. they do not qualify).  In some instances, this is correct.  However, in other instances employers incorrectly apply the overtime exemptions and do not pay overtime when they otherwise should.  Whether an exemption is properly applied must be determined on a case-by-case basis.  Some of the popular exemptions are listed below.  You should contact an attorney if you have any concerns about whether your employer has properly classified you as “exempt” from overtime. 

• White Collar Employee Exemption – The white-collar employee exemption from overtime pay applies to persons who work in certain administrative, professional, and executive job positions.  The white collar exemption from overtime pay is often misunderstood, frequently misapplied, and misused by employers.  For example, many employers will give an employee a job title of “manager” or “supervisor” and claim that the employee is exempt from overtime pay.  In reality, this employee may have little to no managerial or supervisory job duties.  Job titles do not determine exempt status. 

• Highly Compensated Employee Exemption – More lenient standards apply to exempt employees who are considered “highly-compensated” white collar employees who earn a total annual compensation of $100,000 or more per year and who receive $455 per week paid on a salary or fee bases. Since a high level of compensation is considered a strong indicator of exempt status, highly compensated employees are exempt if they customarily and regularly perform any one of the exempt duties in the pertinent exemption.

• Computer employee exemption – To qualify for the computer employee exemption, the employee must be employed as a computer systems analyst, computer programmer, software engineer or other similarly skilled worker in the computer field performing specific duties set forth by the Department of Labor. 

• Outside Sales Employee Exemption – In order for the outside sales employee exemption to apply, the employee must:  1) have a primary duty of “making sales” or “obtaining orders or contracts for services or for the use of facilities for which a consideration will be paid by the client or customer,” and 2) be customarily and regularly engaged away from the employer’s place of business in performing their primary duty. This does not mean that an employee has to spend the majority of his or her time away from the office to qualify for this exemption, but should be away from the office when conducting the sales activities that qualify for the exemption. Unlike some of the other exemptions, the outside sales employee exemption does not require that the employee be paid a salary to be exempt.

• Commissioned Retail Sales Exemption – The commissioned retail sales exemption generally applies where:  1) the employee is employed by a retail or service establishment; 2) the employee’s regular rate of pay exceeds one and one-half times the minimum wage for every hour worked in a workweek in which overtime hours are worked; and 3) more than half the employee’s total earnings in a representative period consist of commissions. Unless all three of these conditions are met and the employer meets the definition of a retail and service establishment, this exemption is not applicable and the employee must be paid overtime at the rate of one and one-half times their regular rate of pay for all hours worked over 40 per workweek.

• Motor Carrier Exemption – Employees whose job duties affect the safety of operation of vehicles in transportation of passengers or property in interstate commerce may be exempt from the FLSA overtime laws pursuant to the Motor Carrier Act. The motor carrier exemption applies to “drivers, driver’s helpers, loaders, and mechanics” whose work “directly affect[s] the safety of operation of motor vehicles on the public highways.” This exemption does not apply if the employee’s vehicle has a gross weight of 10,000 pounds or less. Employers often misapply the motor carrier exemption to employees who are not engaged in “safety affecting activities,” such as dispatchers, office personnel, or employees who unload or load trucks but are not responsible for the proper loading of the vehicle.

• Nurses and Home Health Care Workers – Registered nurses who are paid on an hourly basis must be paid overtime for working more than 40 hours in a workweek. On the other hand, RN’s who are licensed, paid on a salary basis of at least $455 per week, and otherwise meet the duties requirement of the learned professional exemption (which most RN’s would), may be classified as exempt. An important consideration is that the RN must be paid on a “salary basis” to be considered exempt from the overtime pay requirements. This means that RN’s who are paid on a combination salary or fee basis (such as being paid per house visit) and hourly basis (such as receiving hourly pay for attending meetings and completing paperwork) are generally not considered to be paid on a true “salary basis” and would be entitled to overtime. As of January 1, 2015, home health care workers employed by staffing agencies or home health care companies are entitled to minimum wage and overtime pay.

• Blue Collar Workers – If you are a blue collar worker, then you are most likely entitled to overtime pay at the rate of one and one half times the regular rate of pay for weeks when you work overtime hours. Most of the exemptions to the FLSA apply to “white collar” employees and not “blue collar” employees who perform work involving repetitive operations with their hands, physical skill and energy. For instance, non-management production line employees and non-management employees in maintenance, construction and similar occupations such as carpenters, electricians, mechanics, plumbers, ironworkers, craftsmen, longshoremen, operating engineers, and construction workers are entitled to overtime pay. Likewise, the white collar exemptions do not apply to police officers, fire fighters, paramedics, emergency medical technicians or other public safety employees.

• Police, Fire Fighters, Paramedics and other first responders – Overtime laws are slightly different for police officers, fire fighters, and other first responders. Police officers are entitled to overtime pay when they work more than an average of 43 hours a week, depending on the work period the government employer has adopted. However, not everyone employed in public safety or security positions are considered to be “police and law enforcement” employees under the FLSA and should start receiving overtime pay for all hours worked over 40 per workweek as opposed to 43. For example, public employers often misclassify the following types of law enforcement employees as falling under the police exemption:  EMS workers and paramedics, dispatchers, public safety officers without the power to arrest, clerical employees in police stations, traffic control employees, and building guards. Additionally, K-9 officers and dog handlers should be compensated for the time they spend at home or outside their scheduled work shift caring for or working with their dogs. The overtime laws are slightly different for firefighters as well. Generally, firefighters are entitled to overtime pay when they work more than an average of 53 hours a week, or up to 212 hours in a 28 day cycle, if an employer has established a work period of between 7 and 28 days. Local government employers often pay firefighters and rescue employees illegally. Additionally, sleep time may be considered compensable work time for firefighters under certain circumstances.

Contact a Charleston, South Carolina Overtime Lawyer

If you have any questions about payment of overtime or the FLSA exemptions, you should contact an attorney.  You may be owed substantial back wages if your employer failed to pay overtime correctly or misclassified you as “exempt.”  The attorneys at Falls Legal have handled many FLSA overtime actions on both an individual and class basis.