Overtime pay versus comp time

May 1, 2007 6:16 AM

What are the rules, if any, governing overtime pay versus comp time?

Yesterday afternoon, my employer told all employees that there would be no more overtime pay, only comp time. Neither I nor anyone else on my team is salaried.

I live in Arizona and as far as I can tell, Arizona does not have an overtime law, so we should be covered under federal law. But I can't find any explanations of overtime pay versus comp time here.

So, my questions are pretty simple:

1) Is it legal to give employees comp time in lieu of overtime?

2) Would that comp time be accrued like overtime pay, that is, one and a half hours for every hour worked over 40?

3) If it is not legal, what are the specific laws and penalties covering it?

Thanks!

posted by Optimus Chyme to work & money (15 comments total)

You don't say what you do for work. Some types of employees are exempt from the FLSA regulations, and if you fall into that category, the overtime regs simply don't apply to you. It's covered fairly well here.
posted by cerebus19 at 6:27 AM on May 1, 2007

Here's a link to a page with more details.
posted by cerebus19 at 6:30 AM on May 1, 2007

The Fair Labor Standards Act requires employers to pay one-and-one-half-times the regular rate of pay for overtime. However, a lot of positions are exempt from the provisions. More here and here.
posted by curie at 6:36 AM on May 1, 2007

If you're salaried, you are almost certainly exempt. Which means all those protections don't apply to you.

Of course, the flip side of salaried exempt is that they cannot dock your pay if you work less than 40 hours. Salaried is salaried.
posted by Doohickie at 6:44 AM on May 1, 2007

This says that compensatory time may not be granted for overtime, but I'm guessing that only applies if you're covered under the FLSA.
posted by curie at 6:45 AM on May 1, 2007

The OP is NOT salaried.
posted by amtho at 6:48 AM on May 1, 2007

Yesterday afternoon, my employer told all employees that there would be no more overtime pay, only comp time. Neither I nor anyone else on my team is salaried.

While many labor rules vary by state, your employer, no matter your location, is completely within their rights to cap the number of hours they will allow you to work, whether it be by day or by week.

So they can say nobody's going to work more than 5 hours in a day. Or nobody's going to work more than 40 hours in a week. That sounds like what you're saying they're doing, and I assume it's because of what curie found saying that the default premium is 1.5x

The big question in your case is, do they expect you to work 50 hours in a pay period and only pay you for 40, with the expectation that you'll work 30 the next one and get paid for 40? If so, that's almost certainly a violation since you DID work overtime by the very definition of overtime: more than the standard full-time hours in a pay period, and the amount of money you'll receive is not only time-shifted but is also less than if they'd paid you following the rules.

You should call your local labor board.
posted by phearlez at 7:59 AM on May 1, 2007

FLSA exemptions can also apply to employees that are not salaried - There are two requirements for FLSA exemption 1. the wage requirement and 2. the duties requirement. For most exemptions, an employee must make at least $455 a week to meet the wage requirement (for computer professionals it is $27/hr). The duties portion of the exemption requirment varies between the exemptions - an administrator will have different duties than an executive that must be met for an exemption to apply. I would suggest that the OP call their state department of labor and ask them what rules apply in this instance.
posted by miss meg at 8:02 AM on May 1, 2007

IANAL, but I've done work in HR and this smells like a whole lot of bullshit to me.

phearlez is right- your company can deny OT by prohibiting you from working more than 35 (I believe that's the cutoff) hours per week, but they can't expect you to work and bank your pay as some sort of credit without the guarantee it'll be paid back.

I would start with your HR department, and just ask them what's up, that you're concerned. If they don't give you a satisfactory answer, absolutely go to your labor board, and let HR know that you're going to do it- if this becomes a contentious issue with your company, you want to be able to show that you tried to play ball first and didn't run off to the Big Bad Government right away.
posted by mkultra at 8:44 AM on May 1, 2007

BTW, to further clarify- if you were truly classified as a non-exempt employee, your company would owe you nothing for OT. Given that they're offering some bizarre compensation credit instead of just coming out and cutting you off is what set off bells and alarms to me.
posted by mkultra at 8:46 AM on May 1, 2007

BTW, to further clarify- if you were truly classified as a non-exempt employee, your company would owe you nothing for OT. Given that they're offering some bizarre compensation credit instead of just coming out and cutting you off is what set off bells and alarms to me.

mkultra, I believe you mean exempt, not non-exempt.

Exempt=salaried=exempt from the protections of the FSLA=not able to earn overtime pay

Non-exempt=hourly=protected by the FSLA=able to earn overtime pay
posted by donajo at 10:08 AM on May 1, 2007

Again, I am not salaried. But I'm a little confused on the difference between exempt and non-exempt. If my position is classified as exempt - I'm a graphic designer - doesn't that mean that they could have me work, say, 60 weeks one week and pay me for 40, no overtime and no comp, then have me work 30 hours the next and pay me for 30? That's totally insane.

With respect to the "how many hours do they expect you to work" question, it's pretty clear that we need to have our projects completed on time. Sometimes that is impossible without working over 40 hours per week. I have no problem with clocking in at 8:00 sharp and leaving at 5:00 sharp if that's the expectation, but I would be very surprised if they didn't ask why X, Y, and Z aren't finished.

I like my job and in general they are fair and reasonable. But I do not work for free under any circumstances. I do not want my pay time-shifted, just as I don't expect them to give me interest-free loans when things are tight. I just want to be sure that I won't meet with management and have them say "tough titty, stupid: we don't even have to pay you for the twenty extra hours we worked this week because we've determined that you are hourly but exempt from overtime."

Based on the federal guidelines, I do not believe myself to be exempt. My duties are artistic in nature; however, the majority of it is "Illustrator monkey" rather than "artist." Further opinions or data are more than welcome, and thanks for your input so far.
posted by Optimus Chyme at 10:58 AM on May 1, 2007

Again, I am not salaried. But I'm a little confused on the difference between exempt and non-exempt. If my position is classified as exempt - I'm a graphic designer - doesn't that mean that they could have me work, say, 60 weeks one week and pay me for 40, no overtime and no comp, then have me work 30 hours the next and pay me for 30? That's totally insane.

This is correct. As donajo pointed out, I had it backwards.

Based on the federal guidelines, I do not believe myself to be exempt. My duties are artistic in nature; however, the majority of it is "Illustrator monkey" rather than "artist." Further opinions or data are more than welcome, and thanks for your input so far.

Based on my experience, graphic designers are a particularly tricky job to classify for this reason. The guidelines are vague, and I believe hinge on whether you're contributing creatively to the process or are simply a craftsman. For my old company, the divide pretty much fell into Photoshop/Illustrator vs. Quark.

YMMV, but I suspect your company is trying to classify you as exempt, and attempting to couch what is essentially a net-loss to you in the modern-day equivalent of paying miners with "credit" that was only good at the canteen. What they owe you is a raise.
posted by mkultra at 11:11 AM on May 1, 2007

then have me work 30 hours the next and pay me for 30?

I need to read more closely. This part is, I believe, incorrect.
posted by mkultra at 11:13 AM on May 1, 2007

I got comp time (1.5 hours for every hour over 40 in any week) when I worked as an office monkey for the state of North Carolina. I doubt I was exempt, as I was very low on the food chain. I also doubt the state was breaking the law. I remember in orientation getting the impression that the state was allowed to do that, and private companies were not.
posted by Dec One at 8:58 PM on May 1, 2007