Managing payroll can be complicated, tracking hours, factoring taxes and other deductions and of course cutting the checks. Need another complication, don’t forget about overtime pay.
Like all other areas of employee management, there are guidelines. In the case of overtime, the Fair Labor Standards Act ( FLSA ) is the federal law that sets overtime payment requirements for workers in the US.
Under the FLSA overtime rules, you are required to pay your nonexempt employees a rate of 1.5 times the employee’s regular rate of pay for all hours worked beyond 40 in a workweek. Exempt employees are not eligible for overtime under the FLSA
Changes to overtime provisions of the FLSA started making headlines a few years ago when the Obama administration introduced major changes to base salaries required for employees to qualify as exempt.
Most of the changes never took effect because of court challenges, and alternative plans by the Trump administration. Regardless, overtime rules were not in question, and employers are only required to pay nonexempt employees overtime according to FLSA regulations.
In addition to FLSA overtime requirements, some states impose more restrictive overtime obligations on employers.
Need to know what rules apply to your workers? We have compiled a complete State by State guide to overtime.
Want an easier way to manage and process payroll , including over time? Check out QuickBooks Payroll Services .
Use this for quick access to your relevant state.