When an employee takes time off from work, it refers to a type of leave which is taken from their job. Time off may be unpaid or paid, depending upon several factors, including:
- The type of leave taken;
- Federal and state regulations and laws;
- Company policies; and
- The length of time off the employee takes.
The type of leave varies and may include:
- Vacation Leave;
- Sick Leave;
- Parental Leave;
- Military Leave;
- Holiday Leave; and
- Bereavement Leave.
Overtime pay is monetary compensation provided to employees who work more than the number of hours in a normal workweek, which, in most cases, is 40 hours. The Fair Labor Standards Act (FLSA) provides that any employee who is covered under the Act be compensated at a rate of one and one-half times their regular pay for any hours which they work over 40 in a workweek.
The United States Department of Labor enforces the FLSA.
Are Employers Required to Offer Time Off?
Although many employers offer various forms of time off as a benefit for their employees, generally, an employer is not required by law to offer most forms of time off to their employees. However, there are federally mandated exceptions that require an employer to provide time off under certain circumstances, such as time off that is necessitated by conditions that are covered by the Family and Medical Leave Act (FMLA) and employees who must take time off from work to fulfill their military duties.
There are also many states which have laws that guarantee time off for jury duty as well as voting in federal, state, or local elections. In addition to requiring that employees be given time off for those acts of civic duty, some states provide that the leave will be paid.
Are Employers Required to Offer Overtime Pay?
As previously noted, the FLSA is a federal law that requires an employer to pay overtime compensation to an employee covered by the Act. Employers must follow the law and pay overtime unless the employee is exempt from overtime.
There are some employees who are exempt from the overtime pay rule, including:
- Sales employees whose salaries come from more than 50 percent of commission sales. For each hour the sales employee worse, they average an hourly rate which is one and a half times more than the minimum wage pay rate;
- Some computer professionals who earn more than $27.63 as an hourly pay rate;
- Certain transportation workers who deal in foreign or interstate commerce;
- Employees of small farms;
- Seasonal and recreational workers;
- Produce transportation employees;
- Truck, trailer, and boat salespeople; and
- Certain delivery drivers and delivery driver assistants.
In addition to the employees listed above, the FLSA also includes other employees which are exempt from the overtime pay rule.
How is Overtime Pay Calculated?
For a non-exempt employee, the FLSA calculates overtime at the rate of time and a half for any hours which are worked beyond the regular 40-hour workweek. For example, suppose a worker earns $20 per hour, and during a workweek, they work 50 hours total at their place of employment.
Calculations related to this example include:
- The employee’s regular pay would be calculated at $20 x 40 hours, which equals $800;
- Overtime hourly rate would be calculated as $20 x 1.5, which equals $30;
- Overtime pay for this period would be calculated as $30 x 10 hours, which equals $300; and
- The total pay in this example would equal the regular pay of $800 plus the overtime pay of $300, which equals $1,100.
For an employee to be eligible for overtime pay, they must be present at work for the complete 40 hours. For example, if the employee took 4 hours of paid leave during that workweek, the employer would not be required to pay them at the overtime rate.
The employee would instead earn compensation at their regular rate for all hours worked that week.
What is Comp Time?
Comp time, or compensatory time off, is a type of time off that employers sometimes offer employees instead of offering overtime pay. Using comp time, an employer can compensate their employees with leave.
Compensatory time may also be referred to as forced or mandatory overtime. In exchange for this forced time, an employer may provide their employee with paid time off in the future instead of paying them overtime wages.
In other words, compensatory time is a work arrangement in which employees are permitted to take time off instead of receiving overtime pay. For example, suppose an employer requests that their employee complete overtime work at the standard rate of time and a half for every hour worked over the 40-hour workweek.
In this case, the employee may choose to forfeit the overtime pay rate to receive paid time off at a later date. In the United States, these arrangements are considered to be legal for public sector jobs but not for private sector jobs.
If an employee is terminated prior to using all of their earned compensatory time, the time which remains must generally be converted into overtime pay for the employee’s final paycheck. If the final paycheck of the employee does not reflect the credited compensatory time, it is important for the employee to contact their employer prior to accepting their final payment in order to determine what occurred with their compensatory time.
Conflicts arising from compensatory time issues are usually resolved by filing a complaint with a government agency, such as the Wages and Hour Division (WHD) of the Department of Labor. Filing a complaint will lead to an investigation and a potential remedy.
The WHD might suggest that the employee be compensated for their lost wages, or the employer may be required to grant compensatory time if it was improperly denied.
Can Employers Offer Comp Time Instead of Overtime Pay?
An employer whose employees are exempt from the FLSA may offer its employees the option to take comp time instead of receiving the mandatory compensation for their overtime hours. Non-exempt employees, however, must be paid for their overtime hours.
It is against the law for an employer to evade overtime payments to non-exempt employees, even if they agree to take time off instead of payment.
Should I Call an Attorney with my Employment Questions about Time Off Instead of Overtime Pay?
If you are an employee with questions regarding your rights and the laws governing time off, overtime pay, comp time, or any other employment-related matter, it is important to consult with an experienced employment law attorney. Your attorney will help you understand your options and explain the applicable federal and state laws.
If you are an employer with questions regarding providing your employees with time off or overtime pay, your attorney can help you ensure you are providing compensation per the law. Reviewing the issue with an attorney can help prevent disputes from arising.
Employment laws vary from state to state and also include federal and state laws. These laws may be complex and confusing, so it is important to consult with an attorney for clarification. Your attorney can help guide you through whatever issues you may be facing.
