What Is Overtime Pay for $22 an Hour?

When an employee works beyond their standard schedule, they may be eligible for additional compensation known as overtime pay. Regular hourly pay represents the standard compensation an employee receives for each hour worked up to a set limit. Overtime pay then applies to hours exceeding that limit, providing a higher rate of pay for those additional hours.

Basics of Overtime Pay

Overtime refers to hours worked beyond a standard workweek, which is defined as 40 hours. Any time an employee works past the 40-hour mark qualifies for overtime consideration. The standard rate for overtime pay is “time and a half,” meaning the employee receives 1.5 times their regular hourly rate for each overtime hour. An employee’s workweek does not have to align with a calendar week; it can begin on any day and at any hour. Averaging hours over multiple weeks for overtime calculation is not permitted.

Overtime Calculation Example

To illustrate overtime pay for an hourly rate of $22, the regular rate is $22 per hour. The overtime hourly rate is calculated by multiplying the regular rate by 1.5, which results in an overtime rate of $33 per hour ($22 x 1.5).

Consider an example where an employee works 45 hours in a workweek. For the first 40 hours, the employee earns their regular pay, totaling $880 (40 hours x $22/hour). The remaining 5 hours are considered overtime hours.

For these 5 overtime hours, the employee earns $165 (5 hours x $33/hour). Summing the regular and overtime earnings, the employee’s total pay for the 45-hour workweek would be $1,045 ($880 + $165).

Determining Overtime Eligibility

Most hourly employees are considered “non-exempt,” meaning they are eligible for overtime pay. This classification ensures they receive at least the federal minimum wage and overtime compensation. Conversely, “exempt” employees are not subject to these federal minimum wage and overtime requirements.

To qualify as exempt, employees must meet specific criteria, including a salary threshold and a “duties test” related to their job responsibilities. For instance, employees performing executive, administrative, or professional duties, as well as certain computer or outside sales roles, may be exempt. An employee must be paid at least $684 per week on a salary basis to meet the salary threshold for exemption.

The determination of exempt status depends on both the salary paid and the nature of the job duties performed. Job titles alone do not determine exempt status; the actual tasks and responsibilities are assessed. Employers must correctly classify employees to avoid potential compliance violations.

Key Overtime Laws

The Fair Labor Standards Act (FLSA) is the primary federal law governing minimum wage, overtime pay, recordkeeping, and youth employment standards for covered employees. It establishes that unless an employee is exempt, they must receive overtime pay at a rate of no less than time and one-half their regular rate for hours worked over 40 in a workweek. The FLSA applies to most hourly workers and many low-salaried workers, covering private businesses, hospitals, care centers, schools, and public agencies.

While the FLSA sets federal standards, individual states also have their own labor laws, which may offer greater protections or different rules. These state laws can include provisions for daily overtime, different definitions of a workweek, or higher overtime pay rates. Employers must adhere to the law that provides the most favorable outcome for the employee when federal and state laws differ. Consult a state’s labor department for specific local regulations and requirements.