ToolGrym field guide
How Overtime Pay Is Calculated Under US Law
Federal overtime generally requires at least one-and-a-half times the regular rate after 40 hours in a workweek for covered, nonexempt employees. Exemptions and state rules require separate checks.
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Written by the ToolGrym Editorial Team
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The federal calculation
For a covered, nonexempt employee, the Fair Labor Standards Act generally requires at least time-and-a-half for hours over 40 in a defined workweek:
Overtime pay = overtime hours × regular rate × 1.5
At $20 per hour for 47 hours, straight-time pay is $800 for the first 40 hours and overtime is $210 for seven hours at $30. Total gross weekly pay is $1,010. The overtime calculator can model another multiplier when state law or an agreement is more generous.
Federal law generally evaluates each workweek separately. Averaging 35 hours one week and 45 the next does not normally erase five overtime hours in the second week.
Regular rate can exceed the base rate
The regular rate may include certain nondiscretionary bonuses, commissions, shift differentials, and other compensation. It is not always the displayed hourly wage. Some payments can be excluded under specific rules.
For employees with multiple rates or piece-rate compensation, the calculation needs total includable compensation and hours for the workweek. Payroll labels do not control legal treatment.
Salary does not automatically mean exempt
The common executive, administrative, and professional exemptions generally require a salary basis, a minimum salary level, and qualifying duties. The current federal standard salary level listed by the Department of Labor is $684 per week ($35,568 annually), but salary above that amount alone does not prove exemption; the duties test must also be met.
Some occupations follow different rules or exceptions. Misclassification can occur when an employer relies on a job title such as “manager” without matching actual duties.
State law and contracts may pay more
States can require daily overtime, double time, higher salary thresholds, meal-period premiums, or broader coverage. Collective bargaining agreements and employer policies can also exceed the federal floor. When rules overlap, the employee generally receives the protection that applies under the controlling law; verify the specific jurisdiction.
Keep personal records of start and end times, unpaid interruptions, schedules, pay stubs, bonuses, and communications. A workweek is a fixed recurring 168-hour period chosen by the employer; it does not have to match the calendar week.
Frequently asked questions
Can an employer require overtime?
Federal wage law generally does not cap adult work hours, though contracts, safety rules, and state law may differ. Required overtime still must be paid correctly when applicable.
Does paid leave count toward 40 hours?
Federal overtime generally focuses on hours actually worked; employer policy or an agreement may be more generous.
Where should a worker verify classification?
Use current U.S. Department of Labor and state labor-agency guidance or qualified legal advice for the actual duties and pay arrangement.
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The ToolGrym editorial team builds and maintains every calculator on this site. Each tool’s formulas are implemented as tested code and verified against authoritative sources such as the CFPB, Federal Reserve, IRS, and BLS.