While many employers require that their employees have overtime approved prior to actually working it, if an employee does not receive prior approval, the employer is still required to pay the overtime. The employer may choose to discipline the employee for not following the correct procedure, but the overtime hours must be paid. The Fair Labor Standards Act (FLSA) states that nonexempt employees must be paid time and one-half their regular rate of pay for all hours worked over 40 in a seven-day workweek. Nonexempt employees are defined under the FLSA, and appropriate classification of employees is critical. In accordance with the FLSA, overtime pay may not be calculated over a two-week pay period to allow for more flexible scheduling.
Example: John works full time at Pet Mania and his hourly rate of pay is $8.75. Someone calls in sick on John’s day off, so he works an extra eight hours. For the week, John will be paid for his regular hours (8.75 x 40) as well as for the extra hours he put in (8.75 x 1.5 x 8). Therefore, rather than receiving $350 of pre-tax income for the week, John will receive $455 of pre-tax income because of his overtime pay.