If an employer does not establish a workday starting time, the workday is considered to last from a. Daily overtime is due based on the hours worked in any given workday, and averaging hours over two or more workdays is not allowed. After a workday is established by the employer, it must remain consistent and unchanged unless there is a legitimate business reason for changing it. Given that nonexempt employees are entitled to overtime pay if they work more than 40 hours in a workweek, employers should establish which workday begins the workweek to calculate overtime pay accurately.
Under California law, a workweek is defined as any seven consecutive days, starting with the same calendar day each week, beginning at any hour on any day, so long as it is fixed and regularly occurring. An employer may establish different workweeks for different employees, but after an employee's workweek is established, it remains fixed regardless of his or her working schedule. An employee's workweek may be changed only if the change is intended to be permanent and is not designed to evade the employer's overtime obligation.
California law requires employees to track the start and stop times for the beginning of the shift, meal break start and stop, and end of the shift. From these time records, the employer will count the hours worked each workday and workweek as defined above.
Note: To simplify the examples in the following steps, we will be using whole number hours without any minutes or partial hours. We will also assume the workweek follows the calendar week of Sunday to Saturday. The employee worked five days, was absent a few hours on Wednesday and worked longer on Friday. Notice that on Friday the employee worked more than 8 hours in a day and is due 2 hours of overtime at 1.
The employee worked six days and worked more than 8 hours on two of those days. Under the daily overtime rules, the hours worked over 8 on Tuesday and Thursday must be paid at 1. The hours worked over 12 on Thursday are paid at double time 2x. This is an example of an employee who worked all seven days of the workweek.
Because the employee worked 10 hours on the seventh day, the first 8 hours of that day are paid at 1. Under the weekly overtime law, overtime must be paid for any hours worked over 40 in the workweek at the rate of one and one half times the regular rate of pay. In California employers must determine overtime for both daily and weekly overtime hours to ensure all overtime hours are paid each workweek.
This does not mean that employers need to pay overtime twice on the same hours worked. Employers should always look at the daily overtime rules specifically because some of the hours may be required to be paid at double time where weekly overtime only requires hours to be paid at one and one half times regular rate, no matter how many hours are worked beyond Another way to determine whether weekly overtime will increase what has been determined from daily overtime is to look at the total of straight time hours after determining daily overtime.
If after following the daily overtime rules, the employer determines that the employee should be paid for 40 hours or less of straight time, then no adjustments are necessary to meet weekly overtime rules.
If daily overtime results in more than 40 hours of straight time, then these hours over 40 should also be paid at 1. In example 2 commonly referred to as overtime pyramiding , the employee worked six days within a Sunday-to-Saturday workweek by working three 8-hour days, one hour day, one hour day and 6 hours on Saturday for a total of 54 hours in the workweek. According to the daily overtime rules, the employee is paid overtime at one and one half times the regular rate for hours worked over 8 but fewer than 12 in a single workday.
On Thursday, the employee worked more than 12 hours in a single workday, and those last two hours are paid at double time. Note that the employee exceeds a hour workweek on Friday. However, the employee has already been paid overtime for Tuesday and Thursday, totaling 8 hours of overtime already paid. After an employee is paid overtime for hours over 8 in a workday, those overtime hours are also applied to any weekly overtime requirement. Ordinarily, the hours to be used in computing the regular rate of pay may not exceed the legal maximum regular hours which, in most cases, is 8 hours per workday , 40 hours per workweek.
This maximum may also be affected by the number of days one works in a workweek. It is important to determine what maximum is legal in each case.
The alternate method of scheduling and computing overtime under most Industrial Welfare Commission Wage Orders , based on an alternative workweek schedule of four hour days or three hour days does not affect the regular rate of pay, which in this case also would be computed on the basis of 40 hours per workweek. The agreed upon regular hours must be used if they are less than the legal maximum regular hours.
For example, if you work 32 to 38 hours each week, there is an agreed average workweek of 35 hours, and thirty-five hours is the figure used to determine the regular rate of pay. However, in circumstances where the workweek is less than 40 hours, the law does not require payment of the overtime premium unless the employee works more than eight hours in a workday or more than 40 hours in a workweek.
In other words, assuming you are employed under a policy that provides for a hour workweek, the law does not require the employer to pay the overtime premium until after eight hours in a workday or 40 hours in a workweek. If you work more than 35 but fewer than 40 hours in a workweek, you will be entitled to be paid for the extra hours at your regular rate of pay unless you work over eight hours in a workday or 40 hours in a workweek.
The piece or commission rate is used as the regular rate and you are paid one and one-half this rate for production during the first four overtime hours in a workday, and double time for all hours worked beyond 12 in a workday; or.
Divide your total earnings for the workweek, including earnings during overtime hours, by the total hours worked during the workweek, including the overtime hours.
For each overtime hour worked you are entitled to an additional one-half the regular rate for hours requiring time and one-half, and to the full rate for hours requiring double time.
A group rate for piece workers is an acceptable method for computing the regular rate of pay. In using this method, the total number of pieces produced by the group is divided by the number of people in the group, with each person being paid accordingly.
The regular rate for each worker is determined by dividing the pay received by the number of hours worked. The regular rate cannot be less than the minimum wage. Yes, California law requires that employers pay overtime, whether authorized or not, at the rate of one and one-half times the employee's regular rate of pay for all hours worked in excess of eight up to and including 12 hours in any workday, and for the first eight hours of work on the seventh consecutive day of work in a workweek, and double the employee's regular rate of pay for all hours worked in excess of 12 in any workday and for all hours worked in excess of eight on the seventh consecutive day of work in a workweek.
Yes, if it is a nondiscretionary bonus. A nondiscretionary bonus is included in determining the regular rate of pay for computing overtime when the bonus is compensation for hours worked, production or proficiency, or as an incentive to remain employed by the same employer. Incentive bonuses include flat sum bonuses. To properly compute overtime on a flat sum bonus, the bonus must be divided by the maximum legal regular hours worked in the bonus-earning period, not by the total hours worked in the bonus-earning period.
This calculation will produce the regular rate of pay on the flat sum bonus earnings. Overtime on a flat sum bonus must then be paid at 1. Overtime on production bonuses, bonuses designed as an incentive for increased production for each hour worked are computed differently from flat sum bonuses.
To compute overtime on a production bonus, the production bonus is divided by the total hours worked in the bonus earning period.
Under such an agreement, an employee would only qualify for overtime pay if the average hours worked per week during the averaging period exceeds 44 hours. Note that averaging periods cannot overlap one another and must follow one after the other without gaps or breaks. Where a union does not represent employees, averaging agreements must contain an expiry date that cannot be more than two years from the date the averaging agreement takes effect. Where the agreement applies to unionized employees, the expiry date cannot be later than the day the next collective agreement takes effect.
An averaging agreement cannot be revoked by either the employer or employee s before its expiry date, unless both the employer and employee s agree in electronically or writing to revoke it. The Director may have approved averaging hours of work over a period more than the current maximum of four weeks. Myron and his employer agree in writing to average his hours for overtime purposes over a period of two weeks. Myron works 54 hours the first week and 36 hours the second week.
An employer and an employee cannot agree that the employee will give up their right to overtime pay under the ESA. Agreements such as these are not allowed and would be deemed void. However, an employee can make an agreement to take paid time off in lieu of overtime pay or to average hours of work for overtime pay purposes.
The Ministry of Labour, Training and Skills Development advances safe, fair and harmonious workplace practices that are essential to the social and economic well-being of the people of Ontario. Skip to main content. Overtime pay. No overtime on a daily basis Unless a contract of employment or a collective agreement states otherwise, an employee does not earn overtime pay on a daily basis by working more than a set number of hours a day. Overtime is calculated only: on a weekly basis or over a longer period under an averaging agreement Exceptions Many employees have jobs that are exempt from the overtime provisions of the Employment Standards Act, ESA.
Managers and supervisors Managers and supervisors do not qualify for overtime if the work they do is managerial or supervisory. Different kinds of work "50 per cent rule" Some employees have jobs where they are required to do more than one kind of work.
When an employee does two kinds of work Gerard works for a taxi company both as a cab driver and as a dispatcher in the office. If the employee has more than one regular pay rate for overtime work performed An employee who is paid on an hourly basis may perform, in one work week, two types of work, each of which attracts a different hourly rate.
FLSA does not cover double time. Those are agreements between an employer and employee. However, the government offers "Interpretive Guidance" towards such agreements, which changes depending on the geography, nature of the work, and other job factors.
The page also includes E-tools to help employers calculate overtime pay. The same rules do not always apply to minors. For more information on minor specific hours and wage restrictions, visit our Child Labor Laws document.
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