pay

Overtime in plain English: federal FLSA, state daily rules, and the regular rate

10 min read · published 2026-05-05 · updated 2026-05-05

Federal overtime kicks in over 40 hours a workweek for non-exempt workers. Several states require more. The "regular rate" calculation can change overtime pay even on a flat hourly job. Here is what to verify on your stub.

Educational only — not advice. PayslipIQ USA provides educational guidance only. It is not legal, tax, accounting, payroll, employment, credit, financial, or consumer reporting advice. Results are estimates based on the information you enter or upload and may be incomplete, outdated, or inaccurate. PayslipIQ USA does not verify income, certify payroll accuracy, determine legal violations, or confirm that money is owed. PayslipIQ is independent and not affiliated with the IRS, SSA, U.S. Department of Labor, any state tax agency, employer, or payroll provider. Always confirm with your employer, payroll department, the IRS, your state labor or revenue agency, a CPA, attorney, or another qualified professional before acting.Figures reflect tax year 2025. Last verified 2025-04-01. Rules and limits may change.

The federal baseline

Under the Fair Labor Standards Act, non-exempt employees must be paid at 1.5× their regular rate for hours worked over 40 in a workweek. The workweek is a fixed and recurring 168-hour period — it does not have to be Sunday-Saturday.

Exempt vs non-exempt

Most exempt employees (executive, administrative, professional, computer, outside sales) do not earn overtime. Classification depends on the duties test AND a salary basis test (must earn at least the salary threshold, currently $684/week or $35,568/year — proposed increases pending). DOL Fact Sheet #17A is the definitive reference.

States with daily overtime

California: 1.5× over 8 hrs/day or 40 hrs/week, 2× over 12 hrs/day or 8 hrs on the 7th consecutive workday in a workweek.
Colorado: 1.5× over 12 hrs/day, 12 consecutive hours, or 40 hrs/week (whichever is greater).
Alaska: 1.5× over 8 hrs/day or 40 hrs/week.
Nevada: 1.5× over 8 hrs/day if earning less than 1.5× minimum wage.

The regular rate trap

Overtime is computed on the "regular rate," not just your hourly rate. Nondiscretionary bonuses (production bonuses, shift differentials, incentives announced in advance) must be included in the regular rate, which can retroactively increase overtime owed. A worker on $20/hr base + $200 production bonus over a 50-hour week has a regular rate higher than $20.

Compensable time often forgotten

Pre-shift donning of required PPE.
Mandatory training during the workweek.
Travel between job sites within a workday (not the home-to-first-site commute).
Short rest breaks under 20 minutes.
Required staff meetings.

What to check on a stub

Hours classified as overtime — match your time records?
Regular rate used — includes shift differentials and nondiscretionary bonuses?
For CA workers, is daily overtime being calculated separately from weekly?
For multi-site workers, is the regular rate a blend of all rates?

When to escalate

Wage-and-hour disputes have short statutes of limitations (typically 2 years federally, 3 for willful violations). If you believe overtime has been miscalculated, contact your state labor agency or a wage-and-hour attorney promptly.