Common Misconceptions about Overtime Compensation

  1. You are paid a salary and therefore are not entitled to overtime. This is perhaps the most common misconception having to do with overtime claims. Whether or not an employee is paid a salary has no bearing on whether he/she is entitled to overtime. Your status as a salaried employee just means that your employer pays you the same amount of money each week. Your eligibility for overtime depends on whether you are an “exempt” employee. Exempt employees are not entitled to be paid overtime. Exempt employees are professionals (attorneys, physicians, engineers and the like), managerial personnel (people whose main function is to supervise other employees (this does not include all persons whose job title contains the word “manager”)), and administrative personnel (people who are not involved in dealing with a business’s customers, but are behind the scenes in running the inner workings of the business and have substantial authority to make important decisions for the business).
  2. An employer is allowed to pay me “straight time” for all hours worked, even if I work more than 40 hours in a week. This is generally not true. As a general rule, non-exempt employees are required to be paid one and a half times their regular rate of pay for every hour worked over 40 hours in a work week (a work week is defined as seven consecutive days).
  3. I sit at my desk during lunch hour and work. This is my choice, and I am not entitled to be paid overtime. This is not true. Time spent at your desk doing work for your employer is considered to be compensable time.
  4. I am not entitled to be paid overtime because I did not get permission before doing the work. This is another common misconception among employees. If your employer has reason to know that you are doing the work, you are entitled to be paid for the work.
  5. My hours are averaged over a two-week pay period in order to determine whether I am paid overtime, and therefore I am often not paid overtime, even though I work more than 40 hours during a week. An employer is generally not entitled to “average” your hours between two weeks in order to determine whether you are eligible for overtime. That is, if an employee works 30 hours one week and 50 the next, the employer is not entitled to average that as being 40 hours per week to avoid paying overtime for the 50-hour week.
  6. I am required to attend training sessions and meetings at my company and am told that this is not compensable time. This is a very common situation in many industries. Training sessions and meetings that are required by your employer are compensable time.
  7. I can’t keep up with my work at the office, so I take work home with me. My boss told me that I am not entitled to be paid extra for doing that work. If your employer’s job requirements are such that you are not able to finish your work within a 40-hour work week, then your employer is required to pay you overtime for the hours worked over 40, whether that work is performed at your desk or at home. Your employer is not entitled to use the excuse that the work should have been finished during the normal work week in order to avoid paying you overtime.
  8. I am required to report for work 15 minutes prior to my start time in order to begin, set up and report to my manager, but am not allowed to clock in until my scheduled start time. If you are required to be at your place of employment prior to your actual start time, then you are entitled to pay for that extra time. Any time that is required of you by your employer is compensable time.
  9. Only my regular wage is used to calculate overtime pay, even though I am paid commissions and bonuses. As a general rule, all compensation you receive should be calculated in determining your rate of overtime pay. This includes commissions and usually includes bonuses as well. If you are, for instance, paid $10 per hour and you average an additional $5 per hour in commissions, then your overtime pay rate should be $22.50 per hour and not $15 per hour.