The Fair Labor Standards Act (“FLSA”) is a law that was enacted in 1938 and guarantees a minimum wage for all hours worked. The Act also requires that an employee work no more than 40 hours per week. If an employee works more than 40 hours a week, the employer must pay additional compensation, referred to commonly as “overtime.” Section 13(a)(1) of the FLSA exempts from these minimum wage and overtime pay protections ‘‘any employee employed in a bona fide executive, administrative, or professional capacity’’ (the “White Collar” or “EAP Exemption”). [1]
Many employers make the mistake of classifying all of their employees as “exempt,” or simply think it is easier pay all their employees a salary to avoid having to track their hours or pay them overtime. It is a mistake, however, to assume you can classify all employees as exempt employees, rather than dealing with the issues that may accompany having employees who are non-exempt. An improper classification of an employee as exempt may result in the employer being sued for back wages or lead to labor audits. In addition to having to follow the guidelines outlined by the FLSA, many states have other wage and hour laws that go above and beyond the requirements of the federal law. It is the employer’s responsibility to make sure they are abiding by both federal and state wage and hour laws.
During the holiday season, issues about overtime pay seem to crop up even more. Many employees often ask if they are required to work on specific holidays, and if they are must the employer pay them overtime and/or “holiday pay.” There is no straightforward answer to that question. Whether your employer pays you for work on a holiday ultimately depends on the employer for whom you work and their particular policy about holidays, whether you are an exempt or nonexempt employee, and whether you are covered by a Collective Bargaining Agreement or some other employment agreement that grants fringe benefits above and beyond that required by law.
If you are employed by the federal government, for instance, you will receive ten paid holidays each year. Although many private employers follow the same holiday schedule as the federal government, private employers are not required to provide time off for Federal holidays or offer holiday pay if you are required to work. Your employer will have its policies that may confer such pay or paid time off, but no Federal law mandates this, and most state laws do not make it an entitlement either.
It is important to remember the FLSA does require employers to pay time and half of the employees’ regular rate of pay for all hours worked more than forty hours in one workweek. If an employee is working overtime by working a particular holiday, he or she would be entitled to overtime pay and must be compensated at the overtime rate. Conversely, an employer is not required to pay overtime for a paid holiday, or use a paid holiday toward the calculation of the overtime requirement since those paid holiday hours are not hours that were actually “worked.”
End Notes
[1] 29 U.S.C. § 213(a)(1)