Overtime Laws by State: Federal Rules, Exemptions, 2024–2026

Overtime sounds like one federal rule — 40 hours, then time-and-a-half — but five states layer their own daily premiums, double-time, or 7th-day rules on top.

The federal rule is one sentence in the U.S. Code — 29 USC §207(a)(1). The rest of the federal framework — exemption tests, "the regular rate," fluctuating workweeks, retroactive recomputes — is just answering "what counts as 40, and what counts as the hourly rate."

The trap is that "what counts" gets harder fast. A salary doesn't make someone exempt. A "discretionary" bonus often isn't. A worker paid two different hourly rates in the same week isn't owed overtime at either rate — they're owed it at the weighted average. Miss any of those and you're paying back wages doubled by federal liquidated damages, reaching two to three years back (29 USC §216(b), §255(a)).

Then state law layers on top. California requires 1.5× after 8 hours in a day, double-time after 12, and a 7th-consecutive-day premium (Lab. Code §510). Alaska, Nevada, and Colorado have their own daily-overtime rules. Pennsylvania and California reject the federal "fluctuating workweek" shortcut entirely. California uses a different math for flat bonuses (Alvarado v. Dart Container, 4 Cal. 5th 542 (2018)) that costs employers more than the federal version.

In 2024, the DOL tried to raise the federal exempt salary threshold from $684/week to $1,128/week. Two court rulings later, it's back where it started. A Texas federal court struck the rule down (State of Texas v. DOL, No. 4:24-cv-499 (E.D. Tex. Nov. 15, 2024)); the Fifth Circuit dismissed the appeal in May 2026; the DOL formally rescinded the rule on May 14, 2026. As of May 2026, the federal exempt threshold is $684/week ($35,568/year), originally set by the DOL's 2019 Final Rule at 84 Fed. Reg. 51230 and codified at 29 CFR §541.600(a). Note: the codified version at 29 CFR §541.600(a) currently still displays the vacated 2024 amendment text ($844/$1,128) — re-publication to reflect the November 2024 vacatur and May 2026 rescission is pending. The operative number is the 2019 figure.

If you run any business with hourly or salaried workers in the U.S., at least one of those rules is governing your payroll right now. The rest are someone else's lawsuit, waiting to happen.

Skip to the state-by-state table →

Which sections matter for you

Are all your employees hourly, paid one rate, with no bonuses? The 40-hour rule does most of the work. The federal overtime rule plus your state's row in the state-by-state table is probably all you need.
Do you have any salaried employees? Misclassification lawsuits start here. The exemption tests are the first stop; Mistake #1 is the cautionary tale.
Do you pay any bonuses, commissions, shift differentials, or piece rate? "The regular rate" is the trap. How the regular rate is calculated explains why a "discretionary" bonus often isn't.
Do you have workers in California, Oregon, Colorado, Alaska, or Nevada? State law stacks daily-overtime rules on top of the federal weekly rule. The California deep-dive is the model; your row in the state-by-state table tells you which CA-style rules apply.
Are you in healthcare, trucking, agriculture, or federal construction? Your industry has its own carve-outs from the basic rules. The industry-specific section walks each one.
Do you have employees working in different states, or remote workers? Where the work physically happens decides which state's overtime rules apply — not where your business is based. The multi-state walkthrough covers the scenarios.

Quick reference

Federal threshold: 40 hours per workweek; 1.5× the regular rate (29 USC §207(a)(1)).
Federal salary basis (for the white-collar exemptions): $684/week ($35,568/yr) from the DOL's 2019 Final Rule, codified at 29 CFR §541.600(a) — the 2024 increase was vacated.
Highly compensated employee: $107,432/yr from the DOL's 2019 Final Rule, codified at 29 CFR §541.601 — the 2024 attempt to raise it to $151,164 was vacated alongside the standard threshold increase.
States with daily overtime: California, Alaska, Nevada, Colorado; industry-specific in Oregon, Hawaii, North Dakota, Missouri, Wisconsin.
States with double-time: California only.
States that reject the fluctuating workweek: California (Skyline Homes v. DIR, 165 Cal. App. 3d 239 (1985)); Pennsylvania (Chevalier v. GNC, 220 A.3d 1038 (Pa. 2019)); Alaska (AS 23.10.060 + state DOL guidance).
States with non-federal weekly thresholds for non-FLSA employers: Minnesota (48h), Kansas (46h); Maryland (60h, agricultural).
States following federal only: 25 states (see table).
Federal statute of limitations: 2 years; 3 years for willful violations (29 USC §255(a)). Liquidated damages double the recovery (29 USC §216(b)).
Anchor cases: Walling v. Youngerman-Reynolds Hardwood Co., 325 U.S. 419 (1945); Overnight Motor Transp. Co. v. Missel, 316 U.S. 572 (1942); Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680 (1946); Helix Energy Solutions Group v. Hewitt, 598 U.S. 39 (2023); Alvarado v. Dart Container Corp., 4 Cal. 5th 542 (2018).

The 5 most expensive overtime mistakes

1. Calling someone "salaried" doesn't make them exempt

A salary isn't an exemption. To skip overtime, a worker has to clear two separate tests: earn at least $684/week, and have job duties that actually qualify (real management authority, independent judgment, certain professional fields).

Pass one but not the other, and they're "salaried non-exempt" — you owe 1.5× their hourly equivalent for every hour past 40, same as any hourly worker.

The Supreme Court drove this home in 2023. A worker pulling in over $200,000 a year on a daily-rate structure was ruled non-exempt because the rate structure failed the salary-basis test — even at that income level (Helix Energy Solutions Group v. Hewitt, 598 U.S. 39 (2023); 29 CFR §541.604(b)).

Here's what one mistake costs you. A single misclassified coordinator at $50K, claiming 10 unpaid OT hours per week, doubled by federal liquidated damages, across 2-3 years: about $52,000 per worker. Now multiply by every position with the same job description.

California adds a fourth year through its Unfair Competition Law (Bus. & Prof. Code §17200). Massachusetts triples the damages outright (MGL c.151 §1B). New York reaches six years back (NY Lab. Law §198).

2. Calling a bonus "discretionary" when it isn't

A bonus you've announced in advance has to be folded into the overtime rate — even if your handbook calls it discretionary. For a bonus to truly skip the overtime calculation, BOTH the fact of payment AND the amount have to be at your sole discretion, decided near the end of the period (29 CFR §778.211).

A handbook clause that "the Company may in its sole discretion pay an annual holiday bonus" doesn't help if you've actually paid the bonus every December for the last five years. Past practice creates expectation, and expectation defeats discretion.

Bonuses that look discretionary but aren't:

Year-end bonuses you've paid for several years running.
Bonuses announced in a memo or meeting before the period.
Attendance bonuses, production bonuses, "stretch goal" bonuses.
Anything contingent on continued employment.

Here's what you have to do with a non-discretionary bonus. When the bonus covers a period longer than one workweek, you apportion it back across the weeks of the period and recompute the regular rate for any week with overtime hours (29 CFR §778.209). A $1,300 quarterly attendance bonus over 13 workweeks = $100/week added to the regular rate; for any of those workweeks with overtime, additional premium is owed on the bonus portion.

In California, the math is harsher and reaches further. Alvarado v. Dart Container Corp., 4 Cal. 5th 542 (2018), uses non-overtime hours only as the divisor, which produces a higher regular rate. The state's Unfair Competition Law extends recovery to four years.

3. Paying overtime at the wrong rate when an employee does two jobs

If one of your employees does two different jobs at two different hourly rates in the same workweek, here's the trap: you don't pay overtime at the rate they were earning during the overtime hour. You pay it at the weighted average of all their rates for the week (29 CFR §778.115).

Here's how this plays out in practice. Jen is the facilities lead at a 25-person property-management company. She does janitorial work at $20/hour and HVAC repair at $30/hour. In one week she logs 30 hours janitorial and 20 hours HVAC — 50 total hours, including 10 overtime hours.

The wrong way (what payroll systems do by default): pay 1.5× of whichever rate she happened to be working during those 10 OT hours.

The right way:

Total straight-time earnings: (30 × $20) + (20 × $30) = $1,200
Weighted-average regular rate: $1,200 ÷ 50 = $24.00/hour
Overtime premium: 10 hours × 0.5 × $24.00 = $120
Total weekly pay: $1,320

There's a federal escape hatch (§7(g)(2)) that lets you pay at "the rate of the work performed during the overtime hour" — but only if you and the employee have a written agreement before the work is performed, and only if both rates are bona fide. Most employers don't have the agreement and default back to the weighted average without realizing it.

4. Using federal bonus math for a California flat-sum bonus

California has a different rule for flat-sum bonuses (a fixed amount paid for a category of work — e.g., a weekend bonus or a perfect-attendance bonus). The federal method and the California method give different answers, and California's costs more.

The federal method (29 CFR §778.209): total all earnings including the bonus, divide by total hours worked (including overtime hours). That gives the regular rate.

The California method (Alvarado v. Dart Container, 4 Cal. 5th 542 (2018)): divide the bonus by non-overtime hours only. That produces a higher regular rate, and a higher overtime premium.

Same worker, same week — $20/hour × 50 hours + $200 weekend bonus:

Method	Regular rate	OT premium on the bonus	Total weekly pay
Federal	$24.00/hr	$120	$1,320
California (Alvarado)	$25.00/hr	$75 (plus straight-time OT differences)	$1,375

$55 per worker per week. Multiply by the size of your California workforce and the four-year UCL window.

5. Forgetting to recompute overtime on a retroactive raise

You bump a worker's pay rate effective two months ago. Your payroll system handles the straight-time back pay automatically — that's the easy part. What it almost certainly doesn't do is recompute the overtime premium for every workweek in the retroactive period.

That recompute is required by 29 CFR §778.303. If the rate goes from $20/hr to $22/hr retroactive eight weeks, and the worker had 5 overtime hours each of those weeks, you owe:

Straight-time back pay: 8 weeks × 45 hours × $2 = $720 (payroll handles this)
Overtime back pay: 8 weeks × 5 OT hours × ($33 new OT rate − $30 old OT rate) = $120 (payroll usually misses this)

The $120 is what gets missed. Small per hour, but it multiplies across the retroactive period and doubles under federal liquidated damages (29 USC §216(b)). When the same gap exists across every worker whose rate changed, you have a class-action shape.

How federal overtime works

Federal overtime law is one statute — 29 USC §207 — answered by one big regulation, 29 CFR Part 778. Everything below walks you through the parts you actually need.

What does "overtime" actually mean under federal law?

40 hours in a workweek, 1.5× the regular rate (29 USC §207(a)(1)). That's the whole federal rule.

Four things to know about how it actually works:

A "workweek" is whatever 7-day period you choose — Sunday-to-Saturday, Monday-to-Sunday, Wednesday-to-Tuesday. Once you choose it, you can't shift it to dodge overtime (29 CFR §778.105).
Each workweek stands alone. A worker who does 50 hours one week and 30 the next owes 10 hours of overtime on the 50-hour week. The 30-hour week doesn't offset (29 CFR §778.104).
Federal law doesn't require daily overtime. It only cares about the weekly total. Daily-overtime rules are state law — California, Alaska, Nevada, Colorado, and a few industry-specific cases elsewhere.
Federal law doesn't require double-time or a 7th-consecutive-day premium. Only California (Lab. Code §510), Kentucky (KRS §337.050), and a few states with industry-specific carve-outs have those.

If you run a single-state, hourly business with no bonuses or commissions, that's basically the whole federal framework for you. The complexity below applies when you have salaried positions, multiple pay rates, or bonus/commission pay.

What counts as "the regular rate"?

"The regular rate" is the FLSA's term for what most owners would just call "the hourly rate." When an employee earns only an hourly wage, the regular rate IS the hourly rate. When pay is more complicated — bonuses, shift differentials, commissions, piece rate, multi-rate work — the regular rate has to be computed.

The federal definition (29 USC §207(e)) is broad: every dollar of pay counts toward the regular rate, except for eight specific things.

The eight exclusions:

Gifts and holiday/special-occasion payments (not tied to hours).
Pay for hours not worked (PTO, vacation, sick, holiday, jury duty).
Truly discretionary bonuses (see Mistake #2 for why "truly" is doing all the work here).
Pension, profit-sharing, and trust contributions.
Premium pay for hours over 8/day or 40/week paid under a contract or CBA.
Premium pay for Saturday, Sunday, holiday, or 6th/7th-day work at 1.5× or more.
CBA premium pay for work outside the basic workday.
Stock option income.

Everything else flows in: non-discretionary bonuses, shift differentials, commissions, production incentives, attendance bonuses, longevity pay, on-call retainers, and certain reimbursements that don't meet the §778.217 reasonableness test.

Here's why this matters in practice. A worker's regular rate determines their overtime rate (1.5× the regular rate). Underestimate the regular rate by leaving out non-discretionary bonuses or shift differentials, and you've underpaid every overtime hour for the period — silently, week after week, until someone files a claim.

Healthcare's special rule: 8-and-80

If you run a hospital, residential care facility, or skilled nursing facility, you can elect a 14-day work period instead of the 7-day workweek (29 USC §207(j)). Overtime is then owed at 1.5× for either:

Hours over 8 in a workday, OR
Hours over 80 in the 14-day period.

Both thresholds operate independently. A nurse who works one 9-hour shift earns overtime on that 9th hour even if her 14-day total is under 80. The election has to be in writing or by understanding before the work is performed.

Common traps:

The election isn't automatic — you have to actually adopt it. Default is still the 40-hour workweek.
Per-diem and agency nurses commonly trigger weighted-average regular-rate calculations across the 14-day period if they're paid at different rates.
State law can override. California has its own daily-overtime rule for nurses that stacks on top of §207(j).

DOL Fact Sheet #54 walks through the 8-and-80 election in plain language.

Fire and police: extended work periods

Public agencies that employ fire-protection or law-enforcement personnel can use work periods of 7 to 28 days instead of the 7-day workweek (29 CFR §553.230). The thresholds scale linearly:

Fire: 53 hours per 7 days (up to 212 hours per 28 days).
Police: 43 hours per 7 days (up to 171 hours per 28 days).

DOL Fact Sheet #8 walks through §7(k) in plain language. This applies only to public agencies — private security and private fire-protection services use the standard 40-hour workweek.

When can I treat someone as exempt from overtime?

An employee is exempt from federal overtime only if they pass all three of these tests (29 USC §213(a)(1), 29 CFR Part 541):

Salary basis: paid a predetermined amount each pay period that doesn't drop based on quality or quantity of work (29 CFR §541.602).
Salary threshold: at least $684/week ($35,568/year) as of May 2026 — set by the DOL's 2019 Final Rule and codified at 29 CFR §541.600(a).
Duties test: the employee's primary duty fits one of the specific categories below.

All three. Pass the salary tests but fail the duties test, and the employee is non-exempt — you owe overtime, same as any hourly worker.

The duties categories:

Category	Salary threshold	What the duties actually have to be
Executive	$684/week	Primarily manages the business or a department, directs 2+ employees, and has hiring/firing authority (or particular weight in those recommendations) (29 CFR §541.100).
Administrative	$684/week	Primarily office work directly related to management or general business operations of the employer or its customers, requiring discretion and independent judgment on significant matters (29 CFR §541.200).
Professional (learned)	$684/week	Primarily work requiring advanced knowledge in a field of science or learning, customarily acquired through specialized intellectual instruction — engineers, accountants, lawyers, doctors, RNs (29 CFR §541.301).
Professional (creative)	$684/week	Primarily work requiring invention, imagination, originality, or talent in a recognized artistic field (29 CFR §541.302).
Computer	$684/week or $27.63/hr	Primarily systems analysis, programming, software engineering, or related work (29 CFR §541.400).
Outside sales	No minimum	Primarily making sales away from the employer's place of business (29 CFR §541.500).
Highly compensated	$107,432/yr total	Customarily performs at least one exempt duty from the categories above (29 CFR §541.601); threshold from the DOL's 2019 Final Rule.

The employer bears the burden of proving every element of the exemption (Corning Glass Works v. Brennan, 417 U.S. 188 (1974)). The Supreme Court in Encino Motorcars v. Navarro, 584 U.S. 79 (2018) clarified that courts no longer read FLSA exemptions narrowly against the employer — exemption scope now gets a "fair reading" — but the burden of proof still sits with the employer.

In 2024, the DOL tried to raise the threshold — and lost in court. The DOL wanted the standard threshold to climb to $844/week (effective July 2024) and $1,128/week (effective January 2025), and the highly compensated threshold to $151,164. A Texas federal court struck the rule down nationwide (State of Texas v. DOL, No. 4:24-cv-499 (E.D. Tex. Nov. 15, 2024)); the Fifth Circuit dismissed the appeal on May 5, 2026 when the new administration declined to defend it; the DOL formally rescinded the rule on May 14, 2026. The current floor is $684/week.

Here's where misclassification gets you sued. A coordinator paid a $50K salary who follows procedures someone else wrote, supervises no one, and exercises no independent judgment on significant matters → fails the duties test → owes overtime, retroactively, for every hour over 40 worked, doubled by liquidated damages. Helix Energy v. Hewitt, 598 U.S. 39 (2023), holds the line at the high end: even a $200K+ daily-rate worker fails the salary-basis test if the rate structure doesn't meet 29 CFR §541.604(b).

How to actually calculate overtime

29 CFR Part 778 is the regulation that walks through every overtime computation scenario. The sub-sections below are the ones most likely to affect you.

Salaried non-exempt employees (§778.113)

When a salary is intended to cover a fixed number of hours per week, the regular rate is the salary divided by those hours.

A $1,000/week salary intended to cover 40 hours = $25/hour regular rate. Overtime is owed at $37.50/hour (1.5×) for any hour past 40.

If the salary is intended to cover a fixed schedule longer than 40 hours — say a $1,000/week salary for a 45-hour fixed schedule — the math diverges. The regular rate is $22.22/hour ($1,000 ÷ 45). The salary already covers straight time for all 45 hours including the 5 over 40, so you owe only the half-time premium ($11.11 × 5 = $55.56) on top of the salary for those overtime hours.

This "half-time on top of a salary" sub-case is frequently confused with the fluctuating-workweek method (below) — the math comes out the same for a single week in isolation, but the prerequisites are different.

The fluctuating workweek method (§778.114)

If you pay a salaried non-exempt worker a fixed salary that's intended to cover all hours worked in a week, however many or few, you can use the fluctuating-workweek method: the salary covers straight-time for every hour, and you owe just a 0.5× premium (half-time, not time-and-a-half) for hours over 40. The regulation codifies Overnight Motor Transportation Co. v. Missel, 316 U.S. 572 (1942).

All five of these conditions have to hold (29 CFR §778.114(a)):

Hours actually fluctuate week to week.
The salary is fixed regardless of hours.
The salary divided by the highest weekly hours yields at least minimum wage.
A clear and mutual understanding exists between you and the employee that the fixed salary compensates for all hours worked at straight time.
The 0.5× overtime premium is paid for hours over 40.

The 2020 FWW Final Rule (85 Fed. Reg. 34970, June 8, 2020) clarified that bonuses, premiums, commissions, hazard pay, and other additional pay can be paid under FWW so long as those amounts are folded into the regular-rate calculation. The preamble also clarified that hours need not fluctuate both above and below 40 — genuine fluctuation suffices. DOL Fact Sheet #82 is the DOL's plain-language summary.

What kills FWW eligibility:

Salary deductions for partial-day absences (destroys the "fixed salary" prong).
Performance-based salary adjustments (same).
Salary insufficient to cover minimum wage at the highest hours worked.

Three states ban FWW entirely. California, Pennsylvania, and Alaska reject the fluctuating-workweek method (Skyline Homes v. DIR, 165 Cal. App. 3d 239 (1985); Chevalier v. GNC, 220 A.3d 1038 (Pa. 2019), interpreting 43 P.S. §333.104; AS 23.10.060). If you use FWW for a worker in any of those states, every workweek is a separate violation.

When an employee does two jobs (§778.115)

Covered in Mistake #3 above, with worked example (Jen the facilities lead). The federal §7(g)(2) escape hatch requires a written agreement before the work — most employers don't have one and default to the weighted-average method.

How to fold bonuses into the overtime rate (§§778.209 + 778.211)

§778.211 is the discretionary-bonus test. To qualify for the §7(e)(3) exclusion, both the fact of payment and the amount have to be at your sole discretion, decided near the end of the period.

What fails the test (and therefore has to be folded into the regular rate):

Bonuses announced to employees to incentivize work.
Bonuses paid under collective bargaining agreements.
Most attendance bonuses, production bonuses, and quality-of-work bonuses.
Bonuses contingent on continued employment.
Quarterly or year-end bonuses paid year after year, even if the amount itself is "discretionary" — the announcement defeats discretion.

§778.209 governs how the non-discretionary bonus gets folded in over time. When the bonus covers more than one workweek, you apportion it back over the weeks of the period and recompute the regular rate for each week with overtime hours.

A $1,300 quarterly attendance bonus over 13 workweeks = $100/week of additional regular-rate base. For any of those 13 workweeks with overtime, you owe additional premium on the $100/week portion.

The §778.209 alternative-allocation method permits equal-weekly or proportional allocation when the actual-hours apportionment is "burdensome," provided the chosen method yields a reasonable approximation.

Retroactive pay increases (§778.303)

Covered in Mistake #5 above. The straight-time recompute is the easy part; the overtime recompute is what payroll systems silently miss.

The 2019 update: what stopped counting toward overtime

In 2019, the DOL added several items employers used to think they had to include in the regular rate — but don't. The 2019 Regular Rate Final Rule (84 Fed. Reg. 68736, effective Jan. 15, 2020) added these to the §7(e) exclusion list (meaning you DON'T have to fold them into the regular rate):

Reasonable expense reimbursements.
Wellness benefits, gym memberships, onsite-clinic benefits.
Tuition assistance, tuition reimbursement, adoption assistance.
Certain unused-leave payouts.

The rule also clarified the discretionary-bonus test under §7(e)(3) and removed the "infrequent and sporadic" requirement for call-back pay (§§778.221–.222). It modernized the §7(e) exclusions to match how employers actually compensate workers in 2020 without expanding the overtime premium base.

The recordkeeping rule that punishes sloppy records

29 CFR §516.2(a) tells you what records you have to keep for every non-exempt employee:

Personal information (name, SSN, birth date if under 19, sex, occupation).
The time and day the workweek begins.
Daily and weekly hours.
Basis on which wages are paid.
Regular hourly rate for any workweek with overtime.
Straight-time and overtime earnings, additions, deductions, total wages.
Date of payment and pay period covered.

The obligation applies the same to salaried non-exempt employees as to hourly. If you stop tracking hours for someone because "they're salaried," you've created the gap that wage-and-hour plaintiffs exploit.

The Mt. Clemens rule flips the burden of proof onto you. When your records are missing or deficient, the Supreme Court held in Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680 (1946), that the employee carries a low bar: produce enough evidence to support a "reasonable inference" of the hours worked. Then you have to come forward with evidence of the precise amount of work performed. If your records can't, the employee's good-faith recollection becomes the basis the court rules on — and you owe whatever back pay that recollection adds up to.

Tyson Foods v. Bouaphakeo, 577 U.S. 442 (2016), extended this to class actions: representative evidence is admissible when the employer's records are inadequate. One worker's testimony about typical hours can establish the pattern for hundreds of similarly-situated workers.

The discipline is simple, even if the temptation to skip it is real. Track hours for everyone who might possibly be non-exempt — including everyone you're certain is exempt. The cost of tracking is essentially zero; the cost of not tracking is that your records can't refute the employee's claim.

California — the strictest state

If you have any employees working in California — even one remote worker, even a contractor your lawyer insists is a contractor — California's overtime rules apply to the hours those people work in California. They stack on top of the federal rules; the worker gets whichever is more generous, hour by hour.

California Labor Code §510(a) requires:

1.5× the regular rate for hours over 8 per workday.
1.5× the regular rate for hours over 40 per workweek.
2.0× the regular rate for hours over 12 per workday.
1.5× the regular rate for the first 8 hours worked on the 7th consecutive day of work in a workweek.
2.0× the regular rate for hours over 8 on the 7th consecutive day.

The daily and weekly thresholds operate independently; the higher of the two premiums applies to a given hour, not the sum. The 7th-consecutive-day premium applies only when the employee has worked all seven days of the employer's defined workweek.

Alternative workweek schedules

You can run an alternative workweek schedule in California — like 4 × 10-hour days, or 3 × 12 in healthcare — without daily overtime, but only if two-thirds of the affected workers approve it by secret-ballot vote (Labor Code §511). Properly adopted, the schedule permits up to 10 hours per day at straight time. The schedule cannot exceed 40 hours per week without weekly overtime, and any hours beyond the adopted schedule revert to standard daily-overtime rules.

Exempt salary threshold

California's exempt salary threshold is 2× the state minimum wage at 40 hours per week. With the state minimum wage at $16.50/hour for most employers as of 2026, the threshold is $68,640/yr — substantially above the federal $35,568. The threshold applies to executive, administrative, and professional exemptions under Industrial Welfare Commission Wage Orders. Computer professional exemption thresholds are set separately by the Department of Industrial Relations and indexed annually.

Fluctuating-workweek prohibition

California rejects the federal fluctuating-workweek method entirely — salaried non-exempt employees in California must be paid overtime at 1.5× the regular rate under the standard fixed-workweek method, not the 0.5× half-time premium method federal law allows. The case is Skyline Homes, Inc. v. Department of Industrial Relations, 165 Cal. App. 3d 239 (1985), holding that FWW is incompatible with California Labor Code §510. The decision predates the 2020 federal FWW Final Rule and remains controlling.

Flat-sum bonuses use a different math in California

California's Supreme Court decided in 2018 that flat-sum bonuses — a fixed amount paid for a category of work, like a weekend bonus or attendance bonus — get a different overtime calculation than the federal rule. The state divides the bonus by non-overtime hours only, which produces a higher regular rate and a higher overtime premium than the federal method. The case is Alvarado v. Dart Container Corp. of California, 4 Cal. 5th 542 (Cal. 2018), decided March 5, 2018.

Worked example: Marcus the warehouse shift supervisor. Marcus earns $20/hour at a 30-person warehouse in Sacramento. In one week he works 50 hours (40 straight time + 10 overtime) and earns a $200 weekend-shift bonus. Here's how the two methods diverge:

Federal method (§778.209):

Total earnings: $1,000 + $200 = $1,200
Regular-rate contribution from the bonus: $200 ÷ 50 hrs = $4.00/hr
Effective regular rate: $24.00/hr
OT premium: 10 × 0.5 × $24.00 = $120
Total weekly pay: $1,320

California method (Alvarado):

Regular-rate contribution from the bonus: $200 ÷ 40 hrs (non-OT only) = $5.00/hr
OT premium on the bonus portion: 10 × 1.5 × $5.00 = $75
(Plus the standard OT computation on Marcus's base wage)
Total weekly pay: $1,375

$55 more per worker per week, every week Marcus earns the bonus. Multiply that by your California workforce and the four-year window under California's Unfair Competition Law (Bus. & Prof. Code §17200) — Alvarado applied retroactively, so claims reach four years back from filing.

Things employers consistently miss

You can't average hours across weeks. Each workweek stands alone — both federally (29 CFR §778.104) and in California (Lab. Code §510(a)). Two 50-hour weeks followed by two 30-hour weeks means you owe overtime on the 50-hour weeks; the 30-hour weeks don't offset.
A 4 × 10 schedule needs a secret-ballot vote. Setting up an alternative workweek schedule informally ("we just always work four 10s") without the §511 procedural compliance means you owe daily overtime for every hour over 8.
California doesn't allow a tip credit. Federal law and most states let you count tips toward the minimum wage. California doesn't (Labor Code §351). Tipped employees earn the full state minimum wage; tips are supplemental on top and don't enter the overtime calculation.
Missed-break premiums use the regular rate, not just the base hourly. The California Supreme Court ruled in 2021 (Ferra v. Loews Hollywood Hotel, LLC, 11 Cal. 5th 858) that the §226.7 missed-break premium has to include the full regular rate — non-discretionary bonuses and shift differentials folded in, same math as overtime. If you've been paying break premiums at just the base hourly, the bonus + differential portion is back wages.
The 7th-consecutive-day premium depends on how your workweek is defined. A worker who works Monday through the following Sunday only triggers the 7th-day premium if all seven days fall within YOUR defined workweek. If your workweek runs Sunday-Saturday and the worker started Monday and worked through Sunday, the Sunday is in the NEXT workweek — no 7th-day premium. Define your workweek deliberately and apply it consistently.

State-by-state table

State	Daily OT	Weekly OT	7th-day	Double time	Other / citation
Alabama	None	40h @ 1.5×	None	None	Federal only
Alaska	8h @ 1.5×	40h @ 1.5×	None	None	AS 23.10.060; FWW prohibited
Arizona	None	40h @ 1.5×	None	None	Federal only
Arkansas	None	40h @ 1.5×	None	None	Federal only
California	8h @ 1.5×; 12h @ 2×	40h @ 1.5×	1.5× first 8h, 2× after	Yes	Lab. Code §510
Colorado	12h @ 1.5×	40h @ 1.5×	None	None	CO COMPS Order 38
Connecticut	None	40h @ 1.5×	1.5× (hotel/restaurant)	None	CGS §31-76b et seq.
Delaware	None	40h @ 1.5×	None	None	Federal only
Florida	None	40h @ 1.5×	None	None	Federal only
Georgia	None	40h @ 1.5×	None	None	Federal only
Hawaii	8h @ 1.5× (public works only)	40h @ 1.5×	None	None	HRS §387-3; HRS §104 (public works)
Idaho	None	40h @ 1.5×	None	None	Federal only
Illinois	None	40h @ 1.5×	None	None	820 ILCS 105/4a
Indiana	None	40h @ 1.5×	None	None	Federal only
Iowa	None	40h @ 1.5×	None	None	Federal only
Kansas	None	46h @ 1.5× (non-FLSA only)	None	None	K.S.A. §44-1204
Kentucky	None	40h @ 1.5×	1.5× all hours	None	KRS §337.050
Louisiana	None	40h @ 1.5×	None	None	Federal only
Maine	None	40h @ 1.5×	None	None	26 MRS §664
Maryland	None	40h @ 1.5×	None	None	LE §3-415; agricultural 60h
Massachusetts	None	40h @ 1.5×	None	None	MGL c.151 §1A; 3-yr SOL, mandatory treble damages
Michigan	None	40h @ 1.5×	None	None	MCL §408.414a
Minnesota	None	48h @ 1.5× (non-FLSA only)	None	None	Minn. Stat. §177.25
Mississippi	None	40h @ 1.5×	None	None	Federal only
Missouri	10h @ 1.5× (public works only)	40h @ 1.5×	None	None	RSMo §290.505
Montana	None	40h @ 1.5×	None	None	MCA §39-3-405
Nebraska	None	40h @ 1.5×	None	None	Federal only
Nevada	8h @ 1.5× (<1.5× min. wage workers)	40h @ 1.5×	None	None	NRS §608.018
New Hampshire	None	40h @ 1.5×	None	None	Federal only
New Jersey	None	40h @ 1.5×	None	None	NJSA §34:11-56a4
New Mexico	None	40h @ 1.5×	None	None	NMSA §50-4-22
New York	None	40h @ 1.5× (44h live-in domestic)	None	None	12 NYCRR §142-2.2 (overtime rule); NY Lab. Law §198 (6-yr SOL)
North Carolina	None	40h @ 1.5×	None	None	Federal only
North Dakota	8h @ 1.5× (oilfield/construction only)	40h @ 1.5×	None	None	NDCC §34-06-03
Ohio	None	40h @ 1.5×	None	None	ORC §4111.03
Oklahoma	None	40h @ 1.5×	None	None	Federal only
Oregon	10h @ 1.5× (canneries, driers, packing)	40h @ 1.5×	None	None	ORS §653.265 (canneries); ORS §653.272 (agric. phase-in, 48h through 2026)
Pennsylvania	None	40h @ 1.5×	None	None	43 P.S. §333.104; FWW prohibited
Rhode Island	None	40h @ 1.5×	None	None	RIGL §28-12-4.1; Sunday/holiday premium
South Carolina	None	40h @ 1.5×	None	None	Federal only
South Dakota	None	40h @ 1.5×	None	None	Federal only
Tennessee	None	40h @ 1.5×	None	None	Federal only
Texas	None	40h @ 1.5×	None	None	Federal only
Utah	None	40h @ 1.5×	None	None	Federal only
Vermont	None	40h @ 1.5×	None	None	21 V.S.A. §384
Virginia	None	40h @ 1.5×	None	None	Va. Code §40.1-29.2
Washington	None	40h @ 1.5×	None	None	RCW §49.46.130
West Virginia	None	40h @ 1.5×	None	None	WV Code §21-5C-3
Wisconsin	10h @ 1.5× (minors 16-17 only)	40h @ 1.5×	None	None	DWD §272.12
Wyoming	None	40h @ 1.5×	None	None	Federal only

Industry-specific rules

Healthcare

If you run a hospital, residential care facility, or skilled nursing home, the federal overtime structure most likely to apply to you isn't the 40-hour workweek — it's the 8-and-80 election under 29 USC §207(j). You can choose a 14-day work period instead of the 7-day workweek; overtime then kicks in at 8 hours in a workday OR 80 hours across the 14 days, whichever comes first.

The two thresholds operate independently. A nurse can earn overtime on a single 9-hour shift even if her 14-day total is well under 80. The election has to be in writing or by understanding before the work is performed.

Where this gets complicated: per-diem nurses, agency staff, dual-credentialed workers, and travel nurses who pick up shifts at different rates within the same 14-day period trigger the weighted-average regular-rate calculation (29 CFR §778.115) on top of the 8-and-80. DOL Fact Sheet #54 has the framework.

Public safety — fire and police

If you run a public-agency fire department or police force, you have a different overtime structure available. The §7(k) work period lets you use anywhere from 7 to 28 days as the overtime cycle (29 CFR §553.230) — for fire, overtime kicks in at 53 hours per 7 days (up to 212 per 28); for police, 43 hours per 7 days (up to 171 per 28).

Two cases that matter: O'Brien v. Town of Agawam, 350 F.3d 279 (1st Cir. 2003) extended the weighted-average rule to §7(k) work periods when officers do multiple kinds of work at different rates. Chavez v. City of Albuquerque, 630 F.3d 1300 (10th Cir. 2011) addressed how FWW and premium pay interact in this context.

Private security and private fire-protection services — even if they look like public services — use the standard 40-hour workweek. §7(k) is for public agencies only.

Trucking and transportation

If you run a trucking company or interstate motor-carrier operation, most of your drivers are exempt from federal overtime under the Motor Carrier Act exemption at 29 USC §213(b)(1). That's the rule for vehicles weighing more than 10,000 pounds.

The exception that catches employers: the Technical Corrections Act of 2008 narrowed the exemption for vehicles 10,000 pounds or under. Drivers of those "small vehicles" recover overtime under the FLSA regardless of your DOT-regulated status. DOT hours-of-service regulations at 49 CFR §395.3 limit driving hours but don't displace FLSA overtime where the exemption doesn't apply.

Hospitality

If you run a hotel, restaurant, or banquet operation, you've probably got multi-rate workers — servers who also do banquet setup, housekeepers who also do laundry. Federal tip-credit mechanics (29 USC §203(m)) interact with the overtime calculation in a few specific ways:

Tips don't enter the regular rate.
Tip credits applied against the cash minimum wage count toward §531.59 compliance.
When a tipped worker performs non-tipped multi-rate work in the same workweek, the regular-rate calculation has to disentangle which hours qualified for the tip credit.
The "80/20" rule and "30-minute" rule for tipped employees with dual jobs add more complexity.

The leading case for regular-rate computation with §3(m) plus multi-rate work is Marshall v. Brunner, 668 F.2d 748 (3d Cir. 1982).

Construction on federal projects

If you do federal construction work, the Davis-Bacon Act prevailing-wage requirements layer on top of the FLSA regular-rate calculation. Workers commonly hold journeyman certifications in multiple trades and rotate between rate sheets within a workweek — the regular rate is the §778.115 weighted average across actual hours at each trade rate.

Prevailing-wage compensation feeds into the regular rate as remuneration unless specifically excluded under §7(e). The exclusion list is narrow; most prevailing-wage premiums flow into the OT calculation.

Agriculture

Agricultural employees are generally exempt from federal overtime under 29 USC §213(b)(12) — regardless of farm size. Small farms — those employing 500 man-days or fewer of agricultural labor in any quarter of the previous year — get the broader 29 USC §213(a)(6)(A) exemption from both minimum wage AND overtime. (A "man-day" is any day where someone worked at least 1 hour.)

State law fills the gap unevenly. Maryland imposes a 60-hour weekly threshold for agricultural workers. Oregon's threshold was 55 hours in 2024, stepping down to 48 in 2025 and 40 in 2027 under ORS §653.272. California phased in full coverage years ago. Most other states default to the federal exemption.

Canneries, driers, and packing plants (Oregon)

If you operate canneries, driers, or packing facilities in Oregon, ORS §653.265 imposes daily overtime at 1.5× after 10 hours per day. (The statute explicitly excludes manufacturing from this rule.) Weekly overtime still kicks in at 40; the daily threshold is on top. The Oregon Bureau of Labor and Industries enforces it.

Multi-state and remote workers

Which state's overtime rules apply when your employee works in different states? The state where the work physically happens is what decides — not where your business is based, and not where the employee lives. An employee working in California earns California's daily-overtime and double-time premiums even if your business is in Texas and the paychecks come from Texas payroll. The rule traces to the Industrial Welfare Commission Wage Orders and is enforced by the California Labor Commissioner.

Three common scenarios:

Marcus, a remote software engineer based in Austin, takes one week a quarter at his sister's house in Sonoma. The hours he physically works in California are governed by California overtime — 8h daily, 12h double-time, 7th-day premium. The Texas hours follow the federal 40-hour weekly rule. Workweeks split between the two states require pro-rata application.
Sara, a traveling field-service technician, works in California three days, Nevada one day, and Arizona one day of a 50-hour week. California's 8h/day premium applies to her California days. Nevada's 8h/day premium applies only if she earns less than 1.5× the Nevada minimum wage. Arizona has no daily premium. Weekly overtime at 1.5× applies to her hours over 40 regardless of which state they were worked in.
David, a salaried project manager based in Pittsburgh, attends a project meeting in New Jersey one day. Pennsylvania's FWW prohibition (43 P.S. §333.104; Chevalier v. GNC) controls David's overtime computation for the Pennsylvania hours; the standard FLSA fixed-workweek method applies for the New Jersey hours. If your payroll system applies one method to David's whole week, you're miscalculating one half.

Here's what this means for your payroll records. Time records that capture only hours-per-week aren't enough for a multi-state workforce — you also need work location, day by day. The §516.2 recordkeeping requirement plus the state-law overlays means tracking where each hour was worked is the foundation everything else depends on.

Recent changes (last 18 months)

November 15, 2024 — State of Texas v. United States Department of Labor, No. 4:24-cv-499, 2024 WL 4806268 (E.D. Tex. Nov. 15, 2024) vacated the 2024 DOL final rule raising the salary threshold to $844/week (effective July 1, 2024) and $1,128/week (effective January 1, 2025), and increasing the highly compensated threshold to $151,164. The court held that the rule exceeded the agency's statutory authority by effectively converting the duties test into a salary-only test.
May 5, 2026 — The Fifth Circuit dismissed the government's appeal in Texas v. DOL after the administration declined to defend the rule.
May 14, 2026 — The DOL formally rescinded the 2024 final rule. The salary threshold remains $684/week ($35,568/yr) under 29 CFR §541.600(a).
State minimum-wage indexing (2025–2026) — California's exempt salary threshold rose to $68,640/yr on January 1, 2025 with the minimum-wage increase to $16.50/hr; Washington's exempt threshold sits at 2.5× the state minimum wage for larger employers; Colorado's COMPS Order 40 retained the $1,057.69/week threshold for 2025.
No FWW-specific rulemaking pending as of May 2026.
No Supreme Court overtime case pending decision as of May 2026; Helix Energy (2023) remains the most recent §13(a)(1) decision.

FAQ

What's the federal overtime rule, in one sentence?

40 hours a week. 1.5× the regular rate after that. That's the entire federal rule (29 USC §207(a)(1)).

Federal law doesn't require daily overtime. Doesn't require double-time. Doesn't require a premium for the 7th day in a row. Those all come from state law — California is the strictest. The federal floor is just the 40-hour weekly rule.

Do I owe overtime to my salaried employees?

Yes — paying a salary doesn't make someone exempt.

To skip overtime, the employee has to pass BOTH the salary tests AND the duties test for one of the white-collar exemption categories — executive, administrative, professional, computer, or outside sales — at 29 CFR Part 541.

Pay a $50K salary to a "coordinator" who follows procedures someone else wrote, supervises no one, and exercises no independent judgment? You owe overtime — every hour over 40, retroactively, doubled by liquidated damages, reaching 2-3 years back.

Even at very high incomes. The Supreme Court ruled in 2023 (Helix Energy v. Hewitt, 598 U.S. 39 (2023)) that a worker pulling in over $200,000 a year on a daily-rate structure still failed the salary-basis test — overtime owed.

What's the federal exempt salary threshold right now?

$684 per week ($35,568 per year) (29 CFR §541.600(a)).

The DOL tried to raise it to $1,128/week in 2024. A Texas federal court struck the rule down (State of Texas v. DOL) and the DOL formally rescinded the rule on May 14, 2026. As of May 2026, the federal floor is back where it was.

A few states have higher thresholds:

California: $68,640/year (2× state minimum wage)
Washington: 2.5× state minimum wage for larger employers
Federal highly-compensated employee threshold: $107,432/year from the DOL's 2019 Final Rule, codified at 29 CFR §541.601

When can I use the "fluctuating workweek" method to pay half-time overtime?

Only when ALL five of these conditions hold (29 CFR §778.114(a)):

Hours actually fluctuate week to week (not just sometimes — actually).
The salary is fixed regardless of hours.
The salary divided by the highest weekly hours still yields at least minimum wage.
You and the employee have a clear, written understanding that the salary covers all hours at straight time.
You pay a 0.5× premium for hours over 40.

And even if you meet all five federally, you can't use FWW for workers in California, Pennsylvania, or Alaska — those states ban it outright. Every workweek you use it in those states is a separate violation.

One employee works two different jobs at two different rates. What rate do I use for overtime?

Use the weighted average of their rates, not the rate they happened to be earning during the overtime hour (29 CFR §778.115). See Mistake #3 for the full worked example (Jen the facilities lead, $20/hr janitorial + $30/hr HVAC).

There IS a shortcut. The §7(g)(2) alternative lets you pay OT at "the rate of the work performed during the overtime hour" — but only if (1) you have a written agreement with the employee BEFORE the work is performed, and (2) both rates are bona fide. Most employers don't have the agreement and default back to the weighted average without realizing it.

Do I have to include bonuses in the overtime rate?

Yes — and the "discretionary" exception is narrower than most owners realize (29 CFR §778.211).

For a bonus to be truly discretionary (and excluded from overtime), BOTH the fact of payment AND the amount have to be at your sole discretion, decided near the end of the period.

Bonuses that look discretionary but aren't:

Year-end bonuses paid year after year (past practice creates expectation)
Bonuses announced in a memo or meeting before the period
Attendance bonuses, production bonuses, "stretch goal" bonuses
Anything contingent on continued employment

Multi-week non-discretionary bonuses get apportioned back across the weeks earned under 29 CFR §778.209. A $1,300 quarterly attendance bonus is treated as $100 added to each of the 13 workweeks; overtime for any week with hours over 40 gets recomputed at the new effective regular rate.

How far back can an employee sue me for unpaid overtime?

2 years federally — 3 years if the violation was "willful" (29 USC §255(a)). And the damages double under 29 USC §216(b) unless you can prove you acted in good faith (29 USC §260).

State limitations stack on top:

California: 4 years through the Unfair Competition Law (Bus. & Prof. Code §17200)
New York: 6 years (NY Lab. Law §198)
Massachusetts: 3 years with mandatory treble damages (MGL c.151 §1B) — three times the back pay, automatic

A federal willful misclassification case in Massachusetts can hit nine times the unpaid OT (3 years × tripled). In California, four years of UCL + doubled damages produces similar math.

What records do I have to keep?

Track everything for every non-exempt employee — salaried OR hourly. Required by 29 CFR §516.2(a):

Personal info (name, SSN, birth date if under 19, sex, occupation)
When the workweek starts (day and time)
Daily and weekly hours
Basis of pay (hourly, salary, piece-rate, etc.)
Regular hourly rate when overtime is owed
Straight-time and overtime earnings, additions and deductions
Total wages paid
Date of payment and pay period covered

If you stop tracking hours for someone because "they're salaried," you've created the gap that wage-and-hour plaintiffs use.

Missing records trigger the Mt. Clemens burden-shift (Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680 (1946)) — the employee's good-faith recollection of hours controls, and that becomes the case-in-chief against you. The recordkeeping section walks the discipline.

If you discover you've been doing this wrong

If you've just realized you've been miscalculating overtime — for one worker, a job class, or your whole hourly workforce — here's the order of operations:

Pull every record you have for the affected workers. Payroll data, schedule data, time-clock records, project-management tools, ticketing systems, badge swipes if you have them. The records are your evidence. Without them, the §516.2 gap triggers the Mt. Clemens burden-shift — and whatever hours the worker says they worked is what the court accepts.
Figure out how far back you have to look. Federal: 2 years for ordinary violations, 3 years if willful (29 USC §255(a)). California: 4 years through the UCL. New York: 6 years (NY Lab. Law §198). Massachusetts: 3 years with mandatory treble damages (MGL c.151 §1B). Identify the state(s) before computing dollars; the math compounds at the state level.
Compute what you owe. For misclassification, recompute at 1.5× the regular rate for every hour over 40 (or the applicable daily threshold in CA, AK, NV, CO). For regular-rate errors, recompute with the corrected divisor — weighted average under §778.115, bonus-inclusive under §778.209, retroactive-rate-corrected under §778.303. For FWW failures, recompute at the standard 1.5× method, not the 0.5× half-time method.
Decide whether to pay voluntarily under DOL supervision or directly. Voluntary payment under DOL supervision (the PAID program or a WHD-supervised settlement) can resolve the federal claim with a release. Voluntary payment WITHOUT DOL supervision doesn't waive the employee's right to liquidated damages or attorneys' fees under 29 USC §216. State-law claims have separate release mechanics — California, for instance, requires Labor Commissioner or court approval for valid wage releases.
Get a lawyer involved above the per-worker threshold. The $5,000–$10,000 per-worker mark is roughly the practical threshold for class-action exposure under FRCP Rule 23 or §216(b) collective-action procedures. Below it, individual settlements work. Above it, the math is wrong without class-mechanics counsel — you need someone who specializes.

The bottom line

Federal overtime is one equation buried under three layers of trouble. The federal rule itself is a single sentence — 1.5× the hourly rate for hours over 40, written in 29 USC §207(a)(1). Above that sit three layers that catch employers: who's covered (the exemption tests), what "hourly rate" actually means (the regular-rate calculation), and how state laws add daily premiums, double-time, and 7th-day rules on top.

The failure modes recur. All of these compound across two or three years of statute-of-limitations exposure, double under federal liquidated damages, and reach further under state law:

Calling someone "salaried" exempt without checking the duties test.
Calling announced bonuses "discretionary" when the employees expected them.
Paying multi-rate workers the wrong rate during overtime hours instead of the weighted average.
Updating straight-time on a retroactive raise without recomputing the overtime on every overtime hour in the look-back period.
Using the fluctuating-workweek method in California, Pennsylvania, or Alaska where state law forbids it.

When in doubt, track the hours. The single highest-leverage discipline is the 29 CFR §516.2 recordkeeping requirement — workweek-anchored, work-location-aware, multi-rate-capable time records. With them, you have a defensible regular-rate calculation when challenged. Without them, the Mt. Clemens burden-shift means the employee's good-faith recollection of hours worked controls — and that becomes the case-in-chief against you.

Sources

Federal statutes

Federal regulations

Federal rulemakings

2019 Overtime Salary-Threshold Final Rule, 84 Fed. Reg. 51230 (Sept. 27, 2019) — established the operative $684/week threshold
2019 Regular Rate Final Rule, 84 Fed. Reg. 68736 (Dec. 16, 2019)
2020 FWW Final Rule, 85 Fed. Reg. 34970 (June 8, 2020)
2024 Overtime Salary-Threshold Final Rule (vacated), 89 Fed. Reg. 32842 (Apr. 26, 2024)