The labor laws within the United States can get a bit confusing. There are federal laws, defined by the U.S. Department of Labor’s Fair Labor Standards Act (FLSA), and then there are state, municipality, and city laws that add on to the FLSA. Each state has a slightly different set of employment laws, and different cities might also have different regulations between them. So, how much is overtime in NYC?
Regardless of where you work in the United States, overtime hours are all hours that an employee works in excess of 40 hours in a workweek. According to the New York Labor Law, certain residential employees (those who live and work in their employer’s house) used to be paid overtime for all hours worked over 44 hours in a workweek. This number has now changed to 40, like for all other employees.
The overtime rate in New York is not all that different from the one outlined by the FLSA.
Overtime Wages in NYC
The Fair Labor Standards Act declares that the overtime rate for employees must not be less than 1.5 times their regular rate of pay (or 1.5 times the statutory minimum wage in effect in the locale where the employee works if the employee is unlawfully paid below the minimum wage). New York State Overtime Laws follow the FLSA – in New York, the minimum overtime rate is 1.5 times the regular rate of pay.
New York’s minimum wage is $12.50 as of Dec 31st, 2020, in all areas of New York State outside of NYC, Westchester County, and Long Island.
In Long Island and Westchester County, the minimum wage is $14.00 from the same date. In New York City, the minimum wage is $15.00 and will not change.
Calculating the Regular Rate of Pay
The ‘regular rate of pay’ portion of the overtime law may cause some questions. Here is a breakdown of what you need to know about the regular rate of pay.
An employee’s regular rate of pay is the amount of money they are regularly paid for each hour of work. It cannot be lower than the minimum wage, in this case, the New York State minimum wage.
If an employee isn’t paid on an hourly basis (if they receive a fixed salary or are paid for each piece of work they complete), then the regular hourly rate has to be calculated. This hourly rate is found by dividing the employee’s total earnings in a week by the total hours worked during that week.
For example, if an employee worked 50 hours in one workweek and their earnings were (before overtime) $500, then their regular rate is $10.00 per hour:
$500 / 50 hours = $10.00 per hour
However, there is a different calculation for employees in the hospitality industry — such employees that work in restaurants and hotels. For those employees, their regular rate of pay is determined by dividing their gross income by 40 hours.
For example, if a restaurant worker is paid $600 for the week, and works 60 hours, their regular rate is $15.00 per hour:
$600 / 40 hours = $15.00 per hour
Regular Rate for 40+ Hour Workweeks
In New York State, there is no limit to how many hours a week an employee can work. It is not unusual for salaried employees to be hired for workweeks longer than 40 hours. Nevertheless, these employees are entitled to overtime pay (unless they are exempt), and every hour worked over 40 still has to be paid according to the overtime rate.
The number of hours an employee works in a week may only affect the calculation of their hourly rates.
Let’s say that an employee is hired to work a 45-hour workweek (“straight time”) for a weekly salary of $750.
Their regular rate is: $750 / 45 hours = $16.66 per hour
Their overtime rate is: $25.00 per hour * 1.5 = $16.66 per overtime hour
Since the employee works 45 hours a week, they should receive their regular rate ($16.66) for 40 hours
and their overtime rate ($25.00) for the additional 5 hours.
Let’s say an employee in the hospitality industry is paid the same $750 for a 45-hour workweek.
Their regular rate is: $750 / 40 hours = $18.75 per hour.
Their overtime rate is $18.75 *1.5 = $28.13
Since the employee works 45 hours a week, they should receive their regular rate ($18.75) for 40 hours and their overtime rate ($28.13) for the additional 5 hours.
Payments Not Included in Regular Rate
Some payments are not part of the regular rate of pay. They include:
- Discretionary bonuses
- Payments as gifts on special occasions
- Payments for vacation, holidays, or illness (periods when no work was performed)
- Premium payments for overtime work
- Premium payments for work on holidays and the weekends
- Pay for expenses caused by the employer
The law requires employers to notify all new employees of their regular rate and overtime rate at the time of their hiring in written form. In turn, employees must confirm in writing that they have received and understood these provisions.
Frequently Asked Questions
- Which occupations are exempt from overtime pay in NYC?
The New York State Labor Law and the FLSA exempt certain occupations from receiving overtime wages.
These occupations include executive, professional, administrative employees, and outside salespeople. They also include people working for governments, whether municipal, state, or federal.
Farmworkers, taxicab drivers, camp counselors, part-time babysitters, and certain interns, apprentices, and volunteers are also exempt from overtime pay.
Finally, overtime exemptions also include members of religious orders, certain occupations at religious or charitable institutions, and individuals working for a sorority, fraternity, or a student or faculty association.
- Can I get paid overtime for working on holidays, weekends, or night shifts?
New York State laws do not require employers to pay overtime for work performed on holidays, weekends, or night shifts unless that work exceeds 40 hours in a workweek.
However, if the employment agreement (contract) or collective bargaining agreement states that employees are to receive additional pay for holidays, weekends, or night work, then that agreement is enforceable by law.
- Is overtime more than 8 hours a day?
Some states, such as California, limit how many hours a day their employees can work, with it still being considered regular work hours. If an employee works more than 8 hours a day in California, every hour in excess of that is paid as overtime.
This is not the case in New York State. Labor Laws in New York don’t have a daily limit of regular hours. As long as an employee works 40 hours in total in one workweek, those are considered regular hours even if they worked 4 days for 10 hours a day.
- What if I work over 40 hours a week and I’m not paid for overtime?
If you’re not an exempt employee (belonging to one of the groups mentioned above) and are working more than 40 hours a week without getting proper overtime compensation, your employer is likely violating the labor law. In that case, you have the right to report your employer and get fairly compensated for your work.
There are many details to employment laws, especially ones concerning overtime wages. The main takeaway is that you have the right to receive overtime pay in New York City if you’ve worked more than 40 hours in a single workweek (which doesn’t have to coincide with a calendar week).
The minimum overtime rate for non-exempt employees is 1.5 times their regular rate of pay. If you don’t know your standard hourly rate, you can calculate it by dividing your total weekly salary by the total number of hours you’ve worked in a week.
Certain payments such as gifts, bonuses, and premium payments don’t count towards the regular rate.
NY Overtime Laws don’t have a daily overtime limit, as opposed to some other states. However, if you work over 40 hours a week, you are entitled to overtime compensation, no matter how many hours you work each day.
Have any more questions regarding overtime rates in NYC? Contact Cilenti & Cooper for more information and advice regarding unpaid wages and worker rights.