How to Pay Employees for Overtime

How familiar are you with the Fair Labor Standards Act (FLSA)? If you thought that overtime constituted straight pay for non-exempt (hourly) employees who work over 40 hours a week, then it's time you brushed up on the overtime rules.

Many think the FLSA only applies to anyone who earns minimum wage, but in reality, it applies to anyone working in a business engaged in interstate commerce--which is virtually any small business in today's marketplace.

In the "over-40 hours" scenario, the Act requires employers to pay non-exempt personnel wages totalling at least one and one-half times the regular rate for any work done in one workweek with over 40 hours worked in that week.

The law becomes gray when employees perform both clerical and technical duties, and mistakes in reporting and paying overtime can be expensive; penalities could add up to more than $10,000 per day.

Employers should consult with human resource professionals to make sure they understand the law and its interpretation. Paying hourly employees what they're due is much less expensive than a daily fine.

You may like these other stories...

A recent study of lateral hiring trends in the accounting industry by the Chicago-based executive search practice the Koltin Consulting Group (KCG) has found that in the first half of 2014 firms continue to lure top talent...
Without getting into all that's been written about the jobless recovery and record high corporate profits without the accompanying hiring, there has indeed been a fundamental shift in how corporate America is working...
Read more by Rita Keller here.I recently read a tweet by my music-teacher son regarding his fifth-grade musicians: “My fifth-grade flutes and clarinets just exhaust me. They have so much energy and ask sooooo many...

Already a member? log in here.

Upcoming CPE Webinars

Sep 9
In this session we'll discuss the types of technologies and their uses in a small accounting firm office.
Sep 10
Transfer your knowledge and experience to prepare your team for the challenges and opportunities of an accounting career.
Sep 11
This webcast will include discussions of commonly-applicable Clarified Auditing Standards for audits of non-public, non-governmental entities.
Sep 24
In this jam-packed presentation Excel expert David Ringstrom, CPA will give you a crash-course in creating spreadsheet-based dashboards. A dashboard condenses large amounts of data into a compact space, yet enables the end user to easily drill down into details when warranted.