overtime pay 101.

  • career advice
  • December 01, 2017

By 2020, the United States is expected to replace China as the world’s most competitive manufacturing nation, according to Deloitte’s 2016 Global Manufacturing Competitiveness Index. For manufacturing and logistics firms, success in such an environment depends on having employees who are willing go that extra mile — which sometimes means working extra hours. In fact, this is happening already: The average number of weekly overtime hours worked by U.S. manufacturing employees has steadily increased in 2017.

But thanks to the Fair Labor Standards Act (FLSA), all those extra hours worked should be extra rewarding when you get your next paycheck. To help you plan ahead, we’ve got answers for three of the most common questions about overtime pay.

what’s overtime pay?

There are 168 hours in each week. And while there’s no law preventing manufacturing and logistics companies from requiring employees to work all 168 of those hours, overtime pay is one of the reasons they don’t.

Overtime pay simply refers to the wage premium you receive for work done beyond normal working hours. “Normal working hours,” as defined in federal law and the law of most states, means a 40-hour workweek. However, some states require overtime payment for hours worked in excess of eight in a single day.

For clarification, you’ll need to consult the agency in your state that deals with wage and hour/labor standards violations. There’s also the U.S. Department of Labor’s State Labor Laws page, if you need additional information about state-by-state guidelines.

what’s the overtime pay rate?

First, be aware that there’s no maximum overtime rate your employer can pay you, only a minimum, which is often referred to as “time and a half.” Time and a half means that you’ll be paid 1.5 times your regular hourly rate for each hour you work beyond your normal working hours.

Second, bear in mind that certain types of incentive programs can impact how your regular hourly rate gets calculated. For manufacturing and logistics employees, productivity bonuses are a good example. Say you receive a bonus every time the plant’s production level exceeds a certain number of widgets in a given week; in that case, the FLSA requires that these bonuses be factored into your regular hourly pay rate. That should translate to even richer overtime rewards come payday.

do part-time employees receive overtime pay?

The simple answer is yes, eligible part-time employees receive overtime pay. That’s because the FLSA does not distinguish between part-time and full-time employees — which is good news for employees since it means the law applies equally to all workers, regardless of their status. In other words, eligible part-time employees who work beyond normal working hours are just as entitled to overtime pay as their full-time colleagues.

Although specific exemptions do exist, the U.S. Department of Labor’s Wage and Hours Division states that overtime pay as defined in the FSLA covers “virtually all employees of manufacturers” in this handy one-page fact sheet specifically for manufacturing workers. You should check with your supervisor or manager if you aren’t sure whether or not you’re covered. That way, you’ll be more prepared and better able to handle your spending and budgeting come payday.

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