Overtime Guidance Policy
This policy should be supplied to all employees within the
company, either as part of an employee handbook or on its own.
This policy explains to the employee his or her rights and
eligibility to overtime pay. Using this will help to avoid disputes
related to hours worked and pay
ALL INFORMATION AND FORMS ARE PROVIDED “AS IS” WITHOUT ANY WARRANTY,
EXPRESS, IMPLIED, OR OTHERWISE, INCLUDING AS TO THEIR LEGAL EFFECT AND
COMPLETENESS. They are for guidance and should be modified to meet your needs and the
laws of your state. Use at your own risk. Docstoc and anyone who participated in providing
or modifying any form is not creating or entering into an Attorney-Client relationship. Docstoc
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does not provide legal advice. The information and forms are not a substitute for the advice of
your own attorney.
Overtime Guidance Policy
Exempt Vs. Non-Exempt Employees
The Fair Labor Standards Act stipulates that qualifying employees who work more
than 40 hours in a week are entitled to paid overtime. Such qualifying employees
are known as Non-Exempt. Non-qualifying employees are considered ‘Exempt’
and are not entitled to receive any paid overtime.
Who is Exempt or Non-Exempt?
The employer will determine if a position is exempt or non-exempt using the three
stage test set out under the Fair Labor Standards Act. The three tests are:
1. Salaries level test
2. Salary basis test
3. Job duties test
Employment Contract
The employee’s contract will stipulate whether the role is exempt or non-exempt.
Overtime Pay for Non-Exempt Employees
Non-exempt employees are entitled under the FLSA to time and one-half their
"regular rate" of pay for each hour they work over 40 hours in a one week period.
Training time
Most training time is work time. All training time is work time if it occurs during
an employee's regular shift, or if it is required by the employer.
Training will not be counted as work time only if it:
1. Occurs outside of an employee's normal work schedule,
2. Is truly voluntary (as in with neither direct nor indirect pressure on the
employee to attend, and with no "come back" if the employee chooses not to
attend)
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3. Not directly related to the employee's current job (i.e., the training is
designed to qualify the employee to get a new job, and not to enhance the
skills used by the employee on the existing job)
The employee does no other work during the training.
Travel Time
"Home to work" and "work to home" travel time is not work time, and this is true
even if the "commute" is longer than normal, to or from a different work site than
normal, or the employee uses a company vehicle for the trips.
Meal periods
Meal periods will not be counted as work time if they are at least 30 minutes long
and the employee is relieved from active duties during the meal period.
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