Characteristics
An employer who requires or permits an employee to work overtime is generally required to pay the employee premium pay for such overtime work.
Requirements
Unless specifically exempted, employees covered by the Act must receive overtime pay for hours worked in excess of 40 in a workweek at a rate not less than time and one-half their regular rates of pay. There is no limit in the Act on the number of hours employees aged 16 and older may work in any workweek. The Act does not require overtime pay for work on Saturdays, Sundays, holidays, or regular days of rest, as such.
Work Week Defined
An employee’s workweek is a fixed and regularly recurring period of 168 hours (seven consecutive 24-hour periods). It need not coincide with the calendar week, but may begin on any
day and at any hour of the day. Different workweeks may be established for different employees or groups of employees.
Regular Rate
The regular rate includes all remuneration for employment except certain payments excluded by the Act itself. Overtime pay due must be computed on the basis of the average hourly rate derived from such earnings. This is calculated each workweek by dividing:
Total pay for employment
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Total hours actually worked
Where an employee in a single workweek works at two or more different types of work for which different straight-time rates have been established, the regular rate for that week is the weighted average of such rates. That is, the earnings from all such rates are added together and this total is then divided by the total number of hours worked at all jobs. Sometimes referred to as a “Blended Rate”.