There are many terms used in business, but “overtime” is one of my all-time favorites. It’s because it doesn’t really mean what we think it means, and because it tells us a great deal about the culture of the modern workplace.
The story of overtime changed recently, with an update to the Fair Labor Standards Act. As reported by the New York Times:
The change will raise the salary threshold for overtime. Currently, if you are a salaried employee and make less than $23,660 per year, you are eligible for time and a half pay for any hours over 40 per week. The update, which is likely to at least double that threshold, will affect millions of salaried employees.
In 1975, the last year the threshold was significantly raised, 60 percent of salaried workers fell within the requirement for overtime pay. Today, only 8 percent do, according to statistics compiled by the Economic Policy Institute. Under the new rule, millions of workers will be reclassified.
The story of the word overtime is a little boring. It’s just a combination of the words “over” and “time” and first appeared somewhere in the middle of the 16th century—back when it was in fashion to smush two words together to make a new one.
So why is “overtime” such a fascinating concept? Because it implies that there is a pre-arranged and appropriate amount of time you are supposed to work, and any work done past that time should be treated differently.
The Department of Labor has a fascinating webpage about the definition of overtime.. Here are a few quotes, with some emphasis added:
Thus, under the FLSA overtime rules, “nothing happens” unless and until a nonexempt employee has actually worked more than 40 hours in a work week. Stated another way, if an employee’s total hours actually worked in a work week are not more than 40, the FLSA overtime rules are not triggered at all. No FLSA overtime pay is due. If, and only if, total hours actually worked exceed 40 in a work week, then the FLSA overtime rules may come into play.
FLSA overtime pay for nonexempt employees is computed based on all the time the employee has actually worked in a work week. All time actually worked counts, but only time “actually” worked counts. Therefore, the first step in the FLSA overtime formula is to determine how much time a nonexempt employee has actually worked in a work week.
You’re probably scratching your head or rolling your eyes at the complexity of government bureaucracy. What is the difference between “time actually worked” and “time ‘actually’ worked?”
Time for some labor law trivia questions:
1. An employee works as a receptionist and their only duty is to answer the phone when it rings. If they spend 4 hours in a day answering the phone and 4 hours reading a novel while waiting for the phone to ring, how many hours have they worked?
2. An employee works from 8AM to noon and takes a one hour lunch break, and then works from 1PM to 5PM, five days a week. On Friday, the employee decides to work through lunch. Are they owed one hour of overtime?
3. An employee decides to put in an extra five hours of overtime to complete a special project, but does not have permission from their supervisor to do so. If the supervisor does not accept the special project, do they still have to pay the overtime?
The Answer to All Questions
If you’re a labor law nerd, the answers are as follows. (1) Eight hours, because being available to work is the same as working. (2) Yes, they are owed one hour of overtime. (3) No. If an supervisor accepts overtime work, they have to pay for it. If they reject the work, they don’t have to pay for it.
But the bigger answer is to move away from hourly wages and overtime, and instead try to instill a culture of balance in your organization. But just like the word “overtime” is easy to say but difficult to understand, it is hard to change the way your company thinks about your employees’ time when they aren’t “at” work or “doing” work.
All jobs are part-time jobs. The key question is whether or not we respect the individual to have a life outside of work.