Today we have a guest blogger at The Employer Handbook. It’s Kimberly Erskine.
Ordinarily, when I’m offered a wage-and-hour guest blog post, I just yawn — much like you do with the FLSA posts I do myself. But, this one, written from employee’s perspective, is a worthwhile read for both employees and employers alike.
(Want to guest blog on an employment-law topic at The Employer Handbook? Email me).
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In America, the standard work week is 40 hours. Anything over 40 hours is considered overtime. However, many Americans frequently work well past 40 hours each week. Many of these Americans are entitled to receive overtime pay for their extra hours of work. Unfortunately, as many as 70% of all employers fail to comply with wage and hour laws. This results in employees not receiving the proper compensation for their work. Many employees do not fight back against their employers simply because they are unaware of their rights regarding overtime pay. There are many myths regarding overtime pay that overtime have been commonly believed by employees. These myths can deter employees from the truth and prevent them from receiving their proper pay. Here are 4 of the most common overtime myths debunked.
- Salaried workers cannot receive overtime pay. Many salaried employees do not receive the proper pay amount simply because they are under the false assumption that salaried workers are ineligible to receive overtime pay. A salaried worker who earns less than $455 each week and does not work in a supervisory position (supervisor, manager, etc.) may be eligible to receive overtime pay at the rate of one and a half times their regular rate of pay.
- If I work for a flat rate, then I am exempt from overtime. Any employee covered by FLSA, which should be almost all employees, must be paid for overtime hours regardless of any fix pay arrangement. The amount of overtime pay may vary depending on the employer, but all employees must be compensated for any hours worked over 40.
Often times, employers will choose to pay their employees “Chinese overtime” if their employee is paid a flat rate income. In order to use Chinese overtime the employee must work fluctuating hours and be paid a straight-time compensation regardless of whether or not they actually completed 40 hours of work that week. No reductions in pay may be made for short work weeks. In addition, the salary must be large enough to ensure that the regular rate will never drop below minimum wage.
Chinese Overtime is calculated by dividing the flat-rate of pay by the number of hours worked to determine the regular pay rate. For example, if your flat rate of pay is $1,000 per week and you work 45 hours, your regular rate will be $22.22. The employee is due half-time pay for the 5 hours’ worth of overtime work, which would be $11.11 per hour. This would equal out to an overtime pay of $55.56.
- If you earn tips then you are ineligible for overtime pay. Restaurant workers are frequently the victims of inadequate pay. The overtime rules can be a bit tricky to understand in regards to overtime pay. The rule is that their direct pay and tips combined must equal at least minimum wage. For example, their direct wage may be $2.13 an hour so long as when the tips are added in it equals $7.25 or whatever the minimum wage is. If the tips do not add up to the minimum wage, then the employer is responsible for paying the difference. Salaried workers who work more than 40 hours a week may also be eligible for overtime pay.
- You cannot be forced to work overtime. While working long harsh hours may seem a bit inhuman at times, it is not illegal so long as the employee is at least 16 years of age. Employers are free to schedule employees to work well over 40 hours a week. However, if employees work more than 40 hours a week then the employer must pay them overtime wages. The Department of Labor explains in more depth how employers must pay overtime employees.
As an employee, it is important to know your rights in regards to your pay. Always be sure to keep track of the number of hours you work and double check each paystub to ensure you receive the proper amount of pay. If you suspect that you are not receiving the correct amount of pay, don’t be afraid to speak up to your employer or human resources to determine if an error has been made.