Most employees expect that a full-time job will have them working 40 hours per week. But there are times when businesses need their employees to go above and beyond those 40 hours and work overtime to get the job done.
But both employers and employees have questions about this process—more specifically, questions about whether overtime is a voluntary process or if employers can actually require their employees to work more than 40 hours per week.
So, what, exactly, are the overtime requirements? Can businesses make their employees work more than 40 hours per week?
Can An Employer Force Employees to Work Overtime?
Currently, federal law allows employers to impose mandatory overtime on their staff members.
So can employers force employees to work additional hours outside of their scheduled 40 hours per week? Yes. But there are protections in place to ensure employees working mandatory overtime are compensated above their regular rate of pay.
Under the Fair Labor Standards Act (FLSA), a full workweek is 40 hours. For every hour an employee works beyond those 40 hours, employers must provide overtime pay of one and one-half times their regular rate of pay. (It’s important to note that exempt employees don’t qualify for overtime pay; overtime laws only apply to non-exempt employees.)
For example, let’s say your business employs non-exempt, hourly workers for $15 per hour. In any given work week, they can work full-time at 40 hours at their regular rate of pay. But if they work any overtime hours, as a business owner, you’d need to pay them 1.5 times their rate in overtime wages for those hours—which comes out to $22.50 per hour.
So, if one of your employees worked 45 hours in a workweek, their compensation would look like this:
- Regular rate of pay = 40 hours x $15 = $600
- Overtime rate of pay = 5 hours x $22.50 = $112.50
- Total compensation for the week = $712.50
In addition to federal overtime laws, there are certain state laws around required overtime and overtime pay. For example, in California, workers are entitled to overtime pay when they work more than eight hours in a day or more than six days in a workweek (although it is worth noting there are a number of exceptions and exemptions to these overtime laws for doctors, hospital staff, camp counselors and other jobs/industries).
So, in addition to the one and one-half their regular rate of pay for any hours in excess of 40 per workweek, workers in California are also entitled to:
- Any hours worked over eight in a workday: One and one-half their regular rate of pay
- Any hours worked over 12 hours in a workday: Twice their regular rate of pay (also known as double time)
- The first eight hours worked on the seventh consecutive day of work in a workweek: One and one-half their regular rate of pay for the first eight hours worked
- Any hours worked over eight on the seventh consecutive day of work in a workweek: Twice their regular rate of pay
In addition to California, Alaska, Nevada, Colorado, Puerto Rico, and the Virgin Islands also have daily overtime laws.
Are There Limits on How Much Overtime Employers Can Require?
Under the FLSA, there are no limits to how much overtime an employer can require their employees to work. As long as the employee is being compensated appropriately, the employer can require the employee to work as many overtime hours or days as they deem necessary.
There are, however, labor laws (both federal and state laws) that may limit the amount of overtime certain employees can work—like healthcare workers, truck drivers, and other positions where long shifts could pose a safety risk.
If you’re unsure if you need to limit your employees’ amount of overtime for safety reasons, you may consider speaking to an employment attorney at an employment-centric law firm.
Employment lawyers are well-versed in mandatory overtime laws and can give legal advice on how to ensure your company’s policies are in line with all relevant overtime rules and regulations.
Can Employees Refuse to Work Mandatory Overtime?
Employees can refuse to work mandatory overtime—but they could lose their job for doing so.
That’s because employers can require their employees to work additional hours at any time, including on their days off. There are also no requirements on how much notice employers need to give their employees before asking them to work extra hours.
As long as they’re paying them the appropriate overtime wages—and as long as they’re not subject to any additional laws on overtime hours (like regulations around shift length)—businesses can require their employees to work extra hours at any time.
If the employee refuses to work overtime hours, the employer has the right to discipline that employee—up to terminating the worker’s employment with the company.
There are exceptions. For example, if the team member’s employment contract specifically states that they are not subject to overtime hours—and you fire them for refusing to work overtime—they could have a case for wrongful termination.
Employers also can’t take disciplinary action against employees that can’t work extra hours for protected reasons (like if an employee qualifies for an overtime exemption under the Americans with Disabilities Act.)
Things to Consider When Assigning Required Overtime
As mentioned, as an employer, you have the right to require your employees to work mandatory overtime hours. But that doesn’t mean assigning overtime hours is always the right move—both for your business and your employees.
Some things to consider before assigning required overtime hours include:
- Safety risks: For many employees, working more than their scheduled 40 hours per week can lead to fatigue. And in certain positions, being fatigued on the job can pose safety risks. Before you assign overtime hours, make sure to take any potential safety risks into consideration—and schedule accordingly.
- Number of overtime hours previously worked: Most employees have a personal limit to how much overtime they can work in any given period. Before you assign overtime hours, make sure to take into account how much overtime that employee has already worked in recent weeks—and try to spread hours out across employees if possible. (For example, if an employee worked 15 hours of overtime last week, you might consider keeping overtime hours to a minimum the following week to give them time to recover.)
- Employee circumstances: Even though you have the right to require employees to work overtime, some employees’ circumstances simply won’t allow them to work outside of their scheduled shifts. For example, some employees may have children—and not have access to childcare outside of their scheduled work hours. So, while you can ask any employee to work additional hours, it’s also important to keep in mind that every employee may not be able to say yes.
- Budget: One of the biggest things to consider before assigning overtime hours? Budget. As mentioned, when you assign overtime, you’re required to pay your employees an overtime rate of at least 1.5 times their regular rate of pay. As a business owner, this can have a serious impact on labor costs. So, if you find you’re regularly scheduling overtime? It may be time to rethink your scheduling and/or hire more people.
Overtime Best Practices
Looking for more guidance on how to navigate overtime regulations? Here are some best practices to keep in mind when developing overtime policies and procedures for your business:
Talk to Employees About Overtime Requirements Up Front
Ideally, you want to get you and your employees on the same page about required overtime—and you want to get there as quickly as possible.
That’s why you should talk to employees about your company’s approach to overtime from the get-go.
Discuss overtime during the onboarding process. Let your team know if and when they may be required to work overtime—as well as any disciplinary action they may face if they refuse to work mandatory overtime. This conversation is essential in letting your employees know if their job requires overtime hours—which can help avoid potential conflicts in the future.
Include Overtime Policies in Your Employee Handbook
You want to talk to your employees about overtime policies early on in their employment. But talking to them isn’t enough; you also want to have your policies in writing.
Draft out your overtime policies and include them in your employee handbook. Review the policies with each employee and have them sign a document acknowledging that they received and understand the policy. Then, keep the signed document in their employee file.
Including your overtime policies in your employee handbook (and having your employee sign the policy) ensures that, if an employee ever tried to take legal action against you for enforcing your policies, you have clear documentation that they understood and agreed to the policy upon hiring.
Be Accommodating Whenever Possible
As mentioned, in most situations, you have the right to take disciplinary action against employees that refuse to work required overtime—up to terminating their employment.
But that doesn’t mean that you should.
There are all sorts of circumstances that might prevent an employee from being able to work additional hours. For example, they may have family obligations or may not be able to get reliable transportation to and from work outside of their scheduled work hours. And taking disciplinary action against workers that can’t work overtime could have a negative impact on your relationship with your employees—and could lead them to looking for work elsewhere.
Try to be as accommodating as possible when assigning overtime hours. And if an employee refuses an overtime request, make sure to carefully weigh the pros and cons before taking disciplinary action—particularly if they’re refusing the request because they simply can’t work the additional hours.
Track Overtime Hours—And Use the Data to Drive Your Scheduling and Hiring Practices
As a business owner, there may be certain times when overtime is unavoidable. But having your employees work additional hours outside of their scheduled shifts should be the exception, not the rule.
If you have employees working overtime, track the number of hours and when those hours are happening each week. Then, use that data to drive your scheduling and hiring strategy.
Hourly seamlessly combines time tracking, payroll, and workers’ compensation, making it easy to view and manage your employees’ hours and save on overtime. Hourly also uses real-time employee data to calculate workers’ comp premiums with to-the-penny accuracy, ensuring you don’t overpay.
Let’s say after tracking overtime hours, you realize that you’re consistently assigning 10 to 20 overtime hours towards the end of the month in order to successfully fill your orders. In that scenario, you might consider hiring a part-time employee to help manage order fulfillment.
Or let’s say your employees typically work Monday through Friday—but you consistently need one or two employees to work extra hours on Saturday to manage additional customer requests. In that scenario, you might change up your workweek from Monday through Friday to Monday through Saturday. That way, you can schedule employees to work on Saturday and give them an extra day off during the week, which gives you the weekend coverage you need—without paying overtime.
The point is, assigning too much overtime can mess with your employees’ schedules and your budget. So, make sure you’re tracking overtime—and using that information to hire and schedule your employees in a way that allows you to avoid assigning too many overtime hours in the future.
Stay Informed on Mandatory Overtime
As an employer, there may be times when you need your employees to work above and beyond their scheduled shifts. And you have the legal right to require them to work those extra hours.
But if you want to ensure that mandatory overtime doesn’t come back to haunt you, make sure you stay informed on all relevant overtime laws, compensate your employees for their overtime hours, and work with your employees as much as you can to figure out how to schedule overtime in a way that works for you and them.
Are you an employee—and still have questions about required overtime? Here are some FAQs to help you better understand your options:
What can I do if I can’t work mandatory overtime?
If your supervisor asks you to work overtime—but you can’t make those overtime hours work—the best thing you can do is talk to them. Let them know as soon as possible that you can’t work those overtime hours—and let them know why (for example, you don’t have reliable childcare or you have a prior commitment during the working hours they’re requesting).
Now, it’s important to know that your employer can require you to work overtime hours—and if you refuse, you could face disciplinary action, up to being terminated. But many employers recognize that employees won’t always be able to work extra hours or outside of their previously scheduled shifts—so having a conversation and explaining your situation may help you find a resolution without facing any negative consequences.
How will I know if a job requires overtime hours?
If you’re wondering whether a job requires overtime hours, ask during the interview process. While the situation may change at any time, asking an employer during the interview process can help you gauge whether required overtime is a once-in-awhile requirement or a regular part of the job—which can then help you gauge if the position is right for you and your schedule.
What can I do if an employer fires me for refusing to work overtime?
Unfortunately, in most situations, employers have the right to fire employees for refusing to work overtime—so, if you find yourself in that situation, there’s not much you can do about it.
There are, however, exceptions to that rule (for example, if you can’t work overtime due to an injury you sustained on the job or if you’re currently on FMLA leave). If you think your termination violated labor laws, get in touch with an employment attorney in your area.
1. Introducing Yourself
Your introductory email needs to pack a lot of information into a small package. Try something like this:
Text Copied to Clipboard
My name is John Doe and I work for ABC Agency, where we provide business insurance policies to many of Dallas' rockstar small businesses.
Congratulations on your new business, Jane's Bakery. Are you wondering if you have all the insurance you need? Or if your policies will really cover you in a pinch?
At ABC Agency, we pride ourselves on providing robust, comprehensive coverage options to companies like yours with flexible, pay-as-you-go plans.
Are you available this week to talk more about how we can help? I can help you find the most affordable rates and the best policies out there.
I look forward to speaking with you soon.
2. Presenting a Quote
Once you've met with your potential client, a quick reply with their quote will get the ball rolling.
Text Copied to Clipboard
Thanks so much for meeting with me this morning. I loved touring Jane's Bakery–I can still smell those delicious chocolate chip cookies baking! You have a great location, and I'm sure you're going to do great on Front St.
After reviewing my notes, I've pulled together an insurance quote for you (attached). I recommend a business owner's policy. A BOP includes several insurance products in one: liability, property insurance, and business interruption insurance. It offers robust coverage at a competitive price.
I'll call you in a few days to see what you think about this insurance plan. In the meantime, if you have any questions, don't hesitate to email me or call me at [phone number].
Again, thank you for your time today. I look forward to working with you in the future.
3. Thanks for Purchasing a Policy
Gratitude is important! It's never a bad idea to thank your clients for their business.
Text Copied to Clipboard
Thank you for choosing a business owner's policy with ABC Agency. We know it's so important to get the right coverage for your business, and we are honoured you've placed your trust in us.
We're excited to work closely with you, and our no. 1 goal is to make sure you're business is always protected.
Do you have any questions? We are here to help. Reach out whenever something comes to mind.
Thank you again for choosing ABC Agency to insure Jane's Bakery.
4. Welcome Email
A welcome email helps clients feel like you're there to help–and can softly pitch other insurance products you offer.
Text Copied to Clipboard
Welcome to the ABC family! We are thrilled to have you as a new customer and can't wait to meet all of your insurance needs.
As an independent insurance agency, we work with multiple insurance providers to find the best coverage options for all our customers. If you need any other type of insurance–like [include additional offerings unique to your agency, like life insurance, health insurance, home insurance or anything else]–we can help you too.
Do you want to discuss any of these policies?
5. Introducing a New Product
A happy client may want to expand their business with you.
Text Copied to Clipboard
I hope all is well with you and Jane's Bakery. I stopped in yesterday for a blueberry muffin and coffee, and they were delicious. I loved the hint of cinnamon in the muffin! Was that your idea?
I wanted you to be the first to know we are now offering commercial vehicle insurance to our policyholders. Auto insurance for your catering vans is super important since your personal car insurance won't cover them.
We're offering this insurance coverage solely to our current business clients at the moment and have some very competitive rates.
Would you like me to work up a quote for you?
As always, thanks so much for being a part of the ABC family.
6. Asking For Referrals
Once your relationship is established and comfortable, let your clients help you grow.
Text Copied to Clipboard
You've been a valuable member of the ABC family for two years now, and we so appreciate your business–not to mention the muffins you supply for our monthly meetings!
Because you are a valued policyholder, I wanted to ask a quick favour. I know you are active in the local Chamber of Commerce, and I'm hoping you might know some colleagues who would benefit from working with our insurance company.
Referrals are one of the most effective ways to connect with our community since people really trust their friends, family and colleagues. Is there anyone you'd recommend I speak with?
Remember that in addition to business insurance products, we offer everything from life insurance policies to pet insurance.
As a thank you for your help, we will send you an Amazon gift card of $100 when your referrals buy insurance from us.
Thanks so much for your help!
7. Policy Renewal
If your client needs to renew their policy with you, send an email like this:
Text Copied to Clipboard
I hope you're doing well! What a year it's been—from being listed as one of the top 5 bakeries in Dallas to being an official vendor for the city—you have so much to be proud of.
Just a heads up that your business owner's policy is up for renewal soon and will expire on June 15, 2023.
If you're still happy with the coverage, we can easily renew it for you.
Do you have some time to chat this week?
Looking forward to serving you again!