Learn how to set up an employee for overtime pay.
Do you need to pay certain employees overtime? In this article we'll show you how to set up an employee for overtime. And we'll tell you about the federal and state requirements.
Assign overtime to an employee
QuickBooks Full Service Payroll
- Select Workers, and then Employees.
- Select the employee's name.
- Select Pay Information.
- Select the Overtime Pay checkbox. (Also select the Double Overtime pay checkbox if applicable.)
- Select Ok.
Intuit Full Service Payroll
- Select the Employees tab.
- Choose the desired employee.
- Select the Edit option on the Pay section.
- Select the checkbox marked Overtime Pay.
- Select Ok.
Federal and State overtime requirements
Federal overtime requirements
Under the Federal Labor Standards Act (FLSA), overtime is paid to nonexempt employees. Overtime is defined as all time physically worked more than 40 hours in a workweek. The FLSA requires that nonexempt employees be paid at least 150% of their regular rate of pay for all hours physically worked more than 40 in a work week.
FLSA Link: https://www.dol.gov/whd/overtime_pay.htm
State overtime requirements
Even though the FLSA requires overtime to be paid to nonexempt employees who work more than 40 hours in a work week, each state can set its own overtime requirements. For more information, check the appropriate state agency. Some states require a 50% overtime premium on a daily basis after a nonexempt employee works 8 hours in a day. Or a 100% overtime premium when the employee works more than 12 hours in a day.
What about salaried employees?
Salaried employees aren't necessarily exempt from the FLSA's overtime requirements. Only those employees whose salaries exceed a certain level and who meet the duty and responsibility tests for exemption are classified as exempt. All other salaried employees must be paid overtime.