At what point are you due overtime pay versus just doing your job? It’s an important distinction, and you may be due to it more than you realize. Overtime pay is a form of compensation that employers must provide to certain employees who work more than 40 hours in a workweek. Overtime pay is usually calculated as 1.5 times the regular rate of pay for each hour worked over 40. However, not all employees are entitled to overtime pay, and some states have different rules and exemptions for overtime. Let’s look at the basics of Tennessee overtime laws and how they affect workers and employers in the state.
Tennessee Overtime Laws vs. Federal Overtime Laws
Tennessee does not have any state-specific laws for overtime pay, which means it follows the federal overtime laws established by the Fair Labor Standards Act (FLSA). The FLSA is a federal law that sets the minimum wage, overtime pay, child labor, and recordkeeping standards for most employees in the private sector and in federal, state, and local governments. The FLSA covers employees who are engaged in interstate commerce or in the production of goods for interstate commerce, or who work for an enterprise that has an annual gross volume of sales or business of at least $500,000.
The FLSA requires employers to pay non-exempt employees overtime pay of at least 1.5 times their regular rate of pay for any hours worked over 40 in a workweek. A workweek is defined as any fixed and regularly recurring period of 168 hours, or seven consecutive 24-hour periods. It does not have to coincide with the calendar week, and it can start on any day and at any hour of the day. The FLSA does not limit the number of hours an employee can work in a day or a week, as long as they are paid the appropriate overtime pay. The FLSA also does not require overtime pay for working on weekends, holidays, or regular days of rest, unless the employee works more than 40 hours in that workweek.
Who is Exempt from Overtime Pay in Tennessee?
Not all employees are eligible for overtime pay under the FLSA. Some employees are considered exempt, meaning they are not covered by the overtime provisions of the law. To be exempt, an employee must meet certain tests regarding their job duties and salary. The FLSA provides several categories of exemptions, such as executive, administrative, professional, outside sales, computer, and highly compensated employees. Each category has specific criteria that the employee must meet to qualify for the exemption. Generally, exempt employees must be paid on a salary basis, meaning they receive a fixed and predetermined amount of pay each pay period, regardless of the quality or quantity of work performed. They must also receive a minimum salary of $684 per week, or $35,568 per year, as of January 1, 2020. Additionally, they must perform certain duties that are considered exempt under the FLSA, such as managing, supervising, directing, or exercising discretion and independent judgment over significant matters.
The FLSA also provides some industry-specific exemptions, such as for certain employees in agriculture, transportation, retail, hospitality, health care, and entertainment. Some of these exemptions are based on the type of work performed, the amount of revenue generated, or the number of hours worked. For example, employees who work in a bona fide executive, administrative, or professional capacity in a seasonal amusement or recreational establishment are exempt from overtime pay if the establishment does not operate for more than seven months in any calendar year, or if its average receipts for any six months of the preceding calendar year were not more than 33.3 percent of its average receipts for the other six months of the same year.
It is important to note that the FLSA exemptions are narrowly construed, and the burden of proof is on the employer to show that an employee meets all the requirements for an exemption. The job title or classification of an employee does not determine their exempt status; rather, the actual duties and responsibilities of the employee are the decisive factors. If an employee is misclassified as exempt, they may be entitled to recover unpaid overtime wages, liquidated damages, attorney’s fees, and costs.
How to Calculate Overtime Pay in Tennessee
To calculate overtime pay for non-exempt employees in Tennessee, the first step is to determine the regular rate of pay. The regular rate of pay is the hourly rate that an employee earns for all hours worked in a workweek, including any bonuses, commissions, tips, or other forms of compensation. The regular rate of pay may vary from week to week, depending on the amount and type of compensation received by the employee. To calculate the regular rate of pay, the total compensation for the workweek is divided by the total number of hours worked in that workweek.
For example, suppose an employee works 45 hours in a workweek and receives $500 in salary, $50 in tips, and $100 in commissions. The regular rate of pay for that workweek is:
($500 + $50 + $100) / 45 = $14.44
The next step is to multiply the regular rate of pay by 1.5 to get the overtime rate of pay. The overtime rate of pay is the rate that an employee earns for each hour worked over 40 in a workweek. In this example, the overtime rate of pay is:
$14.44 x 1.5 = $21.66
The final step is to multiply the overtime rate of pay by the number of overtime hours worked in the workweek. The number of overtime hours is the difference between the total number of hours worked and 40. In this example, the number of overtime hours is:
45 – 40 = 5
Therefore, the overtime pay for that workweek is:
$21.66 x 5 = $108.30
The total pay for the workweek is the sum of the regular pay and the overtime pay. The regular pay is the product of the regular rate of pay and the first 40 hours worked in the workweek. In this example, the regular pay is:
$14.44 x 40 = $577.60
The total pay for the workweek is:
$577.60 + $108.30 = $685.90
How to File a Complaint for Unpaid Overtime in Tennessee
If an employee believes that they have been denied overtime pay in violation of the FLSA, they have the right to file a complaint with the U.S. Department of Labor’s Wage and Hour Division (WHD). The WHD is the federal agency that enforces the FLSA and other labor laws. The WHD can investigate the complaint, recover unpaid wages, impose penalties, and initiate legal action against the employer. The employee can file a complaint online, by phone, by mail, or in person at any WHD office. The employee should provide as much information as possible about their employer, their work hours, their pay, and the nature of the violation. The employee should also keep records of their hours worked and wages received, such as pay stubs, time cards, or personal logs.
The employee has two years from the date of the violation to file a complaint with the WHD, or three years if the violation was willful. A violation is willful if the employer knew or showed reckless disregard for whether its conduct was prohibited by the FLSA. The employee does not need to pay any fees or hire an attorney to file a complaint with the WHD. The FLSA prohibits employers from retaliating against employees who exercise their rights under the law, such as filing a complaint, cooperating with an investigation, or testifying in court. If an employee experiences retaliation, they can file a separate complaint with the WHD or sue the employer for damages.
Alternatively, an employee can file a private lawsuit against the employer in state or federal court for unpaid overtime wages. The employee can sue for the amount of unpaid wages, plus an equal amount of liquidated damages, as well as attorney’s fees and costs. The employee can also seek injunctive relief, such as reinstatement, promotion, or back pay, if they have been discriminated or retaliated against for asserting their rights under the FLSA. The employee can file a lawsuit on their own or with other employees who are similarly situated, in a collective action. The employee should consult with an experienced employment attorney before filing a lawsuit, as there may be advantages and disadvantages of pursuing a claim in court versus with the WHD.
How to Claim Your Overtime Pay in Tennessee
Tennessee overtime laws are based on the federal overtime laws under the FLSA, which require employers to pay non-exempt employees overtime pay of at least 1.5 times their regular rate of pay for any hours worked over 40 in a workweek. However, some employees are exempt from overtime pay, depending on their job duties and salary. Employees who are entitled to overtime pay should keep track of their hours worked and wages received, and report any violations to the WHD or file a lawsuit in court. Employees who have questions or concerns about their overtime rights should contact a qualified employment lawyer for advice and representation.