Ques­tion: Should we include hol­i­days, PTO, vaca­tion, or oth­er leave tak­en dur­ing the work­week in cal­cu­lat­ing over­time pre­mi­um pay under FLSA rules?

Answer: No. Because hol­i­day, PTO, and vaca­tion hours are not actu­al­ly hours worked they do not count towards over­time pay.

Under the Fair Labor Stan­dards Act (FLSA), an employ­er who requires or per­mits an employ­ee to work over­time is gen­er­al­ly required to pay the employ­ee pre­mi­um pay for such over­time work. Unless specif­i­cal­ly exempt­ed, employ­ees cov­ered by the FLSA must receive over­time pay for hours worked in excess of 40 in a work­week at a rate not less than time and one-half their reg­u­lar rates of pay. The key con­sid­er­a­tion for pre­mi­um pay under the FLSA is whether or not the employ­ee actu­al­ly works more than 40 hours in the work­week, not just that he or she is paid for more than 40 hours in the workweek.

For exam­ple, an employ­ee is off work for one day for a com­pa­ny-paid hol­i­day and takes the next day as a paid vaca­tion day. He then works 10 hours for the next three days of the work­week. Under the FLSA, he would be paid straight time at his reg­u­lar rate for the 46 hours record­ed for that week as fol­lows: 8 hours of hol­i­day pay + 8 hours of vaca­tion pay + 30 hours of reg­u­lar pay for time worked = 46 hours at his reg­u­lar pay rate.

Employ­ers should also check state laws for over­time require­ments regard­ing hol­i­day and vaca­tion time.

Orig­i­nal­ly post­ed on thinkhr.com