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How Overtime Pay is Calculated

Overtime Pay and How Overtime is Calculated

By , About.com Guide

Overtime pay rules are governed by the Fair Labor Standards Act. Overtime pay is based on a 40 hour work week and overtime pay for eligible employees is required for hours worked over those 40 hours.

All non-exempt employees who work over 40 hours during a work week must be paid at a rate of one and one-half times (typically referred to as time and a half) the employee's regular hourly rate.

Non-exempt employees can paid on a weekly, bi-weekly, semi-monthly, or monthly basis, however overtime is always calculated based on a Monday through Friday work week. So, regardless of your pay cycle your overtime pay will be based on a 40 hour, Monday - Friday work week.

Some employees, known as exempt employeers are not entitled to overtime pay.

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