Unpaid Overtime Wages

Contact our Dallas employment lawyers if you have a claim against an employer for unpaid overtime wages. Federal law requires employers to pay employees overtime wages for every hour worked over 40 hours a week. Employers often fail to pay overtime wages to employees, as required by law. If you believe that your employer has failed to pay you overtime wages in accordance with the Fair Labor Standards Act of 1938 (“FLSA”), contact one of our employment lawyers today to schedule a consultation in either our Dallas or Austin office.

Overtime Wages Under the FLSA

The FLSA mandates that employers pay overtime wages to employees for all hours worked over 40 hours a week. Although the law provides exemptions for some employees, most employees are eligible for and should be paid overtime wages. Even when an employee agrees to be paid on a salary basis, if the employee does not meet one of the FLSA overtime exemptions, the employee may bring a claim against the employer for all unpaid overtime hours during the last two or three years. Additionally, the employee has the right to bring the claim while still working for the employer. In fact, the FLSA prohibits an employer from retaliating against an employee because the employee complained about overtime violations.

How to Calculate the Overtime Pay Rate?

Under the FLSA, an employee’s overtime rate is equal to 1.5 times the employee’s regular rate of pay. For example, if an employee’s only compensation is $10 per hour, then the employee’s hourly overtime rate is $15, which is 1.5 x $10. Most employers use this method when paying overtime. However, when an employee receives compensation in addition to the hourly rate, this is not the correct method for calculating the overtime rate.

The overtime rate is equal to 1.5 times the regular rate of pay. The term “regular rate of pay” not only includes an employee’s hourly pay rate, but it also includes almost all other non-discretionary compensation paid to an employee by an employer, such as bonuses and commissions. For example, a weekly bonus must be added to an employee’s hourly rate of pay to determine the regular rate of pay. To do so, the employer must take any bonus or commission amount and divide it by the hours worked during the same period. That amount must be added to the employee’s hourly rate, which becomes the regular rate of pay. For example, if an employee worked 45 hours during the week and received a bonus of $450 for that week, then an employer must add $10 ($450 bonus divided by 45 hours) to the employee’s hourly rate to determine the regular rate of rate. Then, that is the amount that is multiplied by 1.5 to find the correct overtime pay rate.

If your overtime wages are not being calculated correctly, contact our Dallas or Austin office today to schedule a consultation with an employment lawyer.

What Employees Are Exempt from Overtime Requirements?

Although most employees must be paid overtime wages for hours worked in excess of 40 hours a week, there are certain exemptions within the FLSA. The main exemptions to overtime wages are referred to as the executive exemption, the administrative exemption, and the professional exemption. One of the requirements of the administrative exemption is that an employee must manage two or more full-time employees. To qualify for the administrative exemption, an employee must, among other things, have the ability to exercise discretion regarding business matters of significance. However, most employees do not have the amount or type of discretion needed to qualify for this exemption. Under the professional exemption, an employee must be in a position or role that requires an advanced education, generally in the field of science or learning.

In addition to the requirements listed above, there are several other requirements that must be met in order to exempt an employee from being entitled to overtime wages. Contact one of our Dallas employment lawyers if you have not been paid overtime wages that are owed to you.

Do Independent Contractors Get Overtime Pay?

Although an employer does not have to pay overtime wages to an independent contractor, many workers are mistakenly classified as "independent contractors" when they are actually "employees" under the law. There are tests that apply when determining if a worker is an independent contractor or an employee.

The Fair Labor Standards Act ("FLSA") looks to the amount of control and the economic reality to determine if an independent contractor is actually an employee for purposes of paying overtime wages. Although this is not the entire test, an independent contractor is likely an employee under the FLSA if the employer (i) directs the work, (ii) controls the schedule, (iii) supplies the equipment, (iv) enforces disciplinary actions, and/or (v) if the independent contractor's sole income is from the employer. Additionally, it is the employer that has the burden of proof under the FLSA.

If an independent contractor is actually a non-exempt employee according to the FLSA, then the employer owes the independent contractor overtime wages for any time worked in excess of 40 hours each workweek for the last two to three years. The employer would also owe liquidated damages, which generally acts to double the amount owed to the worker. 

The FLSA also does not allow employers, employees, and/or independent contractors to contract around the overtime requirements of the FLSA. As such, an independent contractor agreement does not necessarily prevent a worker from pursuing claims for unpaid overtime wages.

Sadly, many employers take advantage of employees by mislabeling them as independent contractors and failing to pay required overtime wages. If you believe you may be owed overtime pay and/or unpaid wages, contact one of our Texas employment lawyers today. In a consultation with one of our overtime lawyers, you can discuss your claim for unpaid overtime wages.

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