The Fair Labor Standards Act (“FLSA”), 29 U.S.C. §201 et seq. establishes minimum wage, overtime pay, recordkeeping, and youth employment standards affecting employees in the private sector and in Federal, State, and local governments. The FLSA guarantees certain types of workers who meet overtime pay requirements overtime for all hours worked over 40 in a single week.

The Rules of Overtime

Since there has been a steady increase in the number of employees who work over a normal 40-hour workweek, the concern is whether or not overtime is appropriate. For any hour that is worked past the 40-hour workweek, an employee should receive what is known as “overtime.” It is important to note that there are exceptions, specific industries and jobs, which are exempt from overtime. Nonetheless, overtime is usually equivalent to at least 1.5 times the employee’s hourly wage. Suppose you work 45 hours in one workweek with a straight pay of $10/hr. In this case, you should be paid $10/hr for the first 40 hours (totaling $400) and $15/hr for the 5 overtime hours (totaling $75).

Exempt v. Nonexempt

However, there are some situations where an employee is “exempt” and the employer is not required to pay overtime for any hours he/she worked over a 40-hour workweek. Employees are classified as “exempt” or “nonexempt.” Nonexempt employees are entitled to overtime pay. Exempt employees are not. For most employees, however, whether they are exempt or nonexempt depends on (a) how much they are paid, (b) how they are paid, and (c) what kind of work they do.

New Overtime Law of 2016

Prior to July 6, 2015, certain executive, administrative, and professional workers (“white-collar workers” or “EAP workers”) were “exempt” from overtime.  To be considered exempt (and therefore not eligible for overtime), an employee had to: (a) be paid at least $23,600 per year ($455 per week), (b) be paid on a salary basis and (c) perform exempt job duties. These requirements are outlined in the FLSA. Therefore, under the old laws, if an employee made less than $23,600 per year or less than $455 per week, he or she was automatically eligible for overtime.

What if I’m not paid for my overtime?

However, there are new overtime laws in Pennsylvania that could impact your ability to collect overtime. On July 6, 2015, in response to an executive order signed by President Barack Obama in March 2014, the Department of Labor (“Department”) published a Notice of Proposed Rulemaking that changes the meaning of overtime in the United States. President Obama’s order seeks to raise the threshold for overtime eligibility. The new proposal would make it so salaried employees earning less than $50,440 a year or less than $970 a week $47,476 per year or $913 per week (updated to reflect December 2016 law) are automatically guaranteed time and a half after logging a 40-hour work week. The new proposal doubles the threshold requirement to be eligible for overtime.

Prior to July 6, 2015, if an employee made less $23,600 per year or less than $455 per week, they were automatically eligible for overtime. Now, an employee earning less than $50,440 a year or less than $970 a week $47,476 per year or $913 per week is automatically eligible for overtime.   This change could impact over 5 million Americans and over 200,000 workers in Pennsylvania. President Obama’s order expected to take place as early as 2016 could expand the number of overtime-eligible employees from 8% to 40%.

Are You Eligible For Overtime?

Therefore, in order to determine if an employee is eligible for overtime, he or she should consider the following:

1. Is your income less than $50,440 a year or less than $970 a week $47,476 per year or $913 per week?
2. Do you work more than 40 hours per week?

If you answered yes to both of these questions you may very well qualify for overtime under the FLSA. KM&A offers free and immediate consultations with an employment attorney. It is our philosophy that aggressively pursuing our clients’ interests means that we have to be extremely accessible. Don’t hesitate to contact us at 412-626-5626 or by email at lawyer@lawkm.com for a free consultation.