As an employer, it is imperative to understand the rules surrounding time and a half.<\/strong> Failure to comply with timekeeping requirements<\/a> and wage and hour laws<\/a> can result in hefty fines. For example, a recent Federal investigation<\/a> recovered nearly $100,000 in pay for 53 employees of a Danville-based health care company (California) after employees were not paid time and a half when working more than 40 hours in a week.<\/p>\n In this article, we will break down what time and a half is, which employees qualify for it, and how you need to calculate it when submitting payroll. We will also share an overtime tracker excel and discuss the benefits of using software to manage time and attendance in your company<\/strong> and ensure compliance with US employment laws<\/a>.<\/p>\n Time and a half refers to the increased hourly rate that employees working overtime are entitled to receive<\/strong>, as established by the Fair Labor Standards Act (FLSA). According to The Department of Labor<\/a> website, non-exempt employees covered by the FLSA must receive overtime pay for all hours worked outside of their normal 40-hour working week, at a rate of an additional 50% of their regular hourly rate of pay.<\/p>\n There have been several changes to overtime laws in the US over recent years which employers need to be aware of. For example, on September 24, 2019, the U.S. Department of Labor announced a final rule<\/a> to make 1.3 million American workers newly eligible for overtime pay.<\/strong> This ruling updated the earnings thresholds necessary to exempt executive, administrative and professional employees from the FLSA minimum wage and overtime pay requirements, and it means that employers are now able to count a portion of certain bonuses\/commissions towards meeting the salary level.<\/p>\n In addition to this, certain states take the FLSA\u2019s overtime rules a step further to enforce overtime pay for employees who work more than eight, nine, or 10 hours a day<\/strong>, as is the case in California<\/a>. The California Labor Code section 510<\/a> also states that any employee that works over eight hours in a workday is also entitled to time and a half. It is always best to check your state\u2019s labor department to ensure you are in compliance with local labor regulations.<\/p>\n Under the FLSA, you must pay time and a half for any hours your employees work over the standard 40-hour working week. However, whether or not you are obligated to pay your employees overtime pay depends on their status. They can be either considered exempt or nonexempt employees. We will discuss eligibility requirements shortly, but for now, let\u2019s start by looking at how time and a half works.<\/strong><\/p>\n Many factors determine whether or not an employee is eligible to receive overtime pay. These factors include whether an employee is hourly or salaried, the salary amount an employee receives,<\/strong> and an employee’s duties and responsibilities.<\/strong> It\u2019s important to understand the status of your employees as exempt or nonexempt in their contracts of employment. This ensures there is no confusion later down the line and reduces the chances of an employee dispute.<\/p>\n The main difference between nonexempt and exempt employees is that nonexempt employees can earn overtime pay and exempt employees cannot. It is your responsibility as an employer to demonstrate whether or not your employees are eligible<\/a>.<\/p>\n Consider the following…<\/p>\n Exempt employees (not entitled to time and a half):<\/strong><\/p>\n Nonexempt employees (entitled to time and a half):<\/strong><\/p>\n However, as there are additional overtime laws in certain states, it is important to establish your local regulations to ensure compliance. Be sure to search for state and local specific information to ensure compliance with your employment laws.<\/p>\n You must pay all your non-exempt employees time and a half for any overtime hours they work. However, as nonexempt employees can be salaried, you need to know how to calculate time and a half for both salaried and hourly employees.<\/p>\n Calculating time and a half for hourly employees<\/strong><\/p>\n The time and a half formula:<\/p>\n (Standard Hourly Rate) \u00d7 1.5 = Time and a Half Rate<\/p>\n This equation gives you the hourly time and a half rate for non-exempt employees. You then need to multiply this rate by the number of overtime hours the employee worked.<\/p>\n Calculating time and a half for salaried employees<\/strong><\/p>\n For non-exempt salaried employees who work fixed hours, first, you need to establish what their hourly rate would be. You can do this by dividing their weekly salary by the number of hours they typically work.<\/p>\n Once you have this figure, you can calculate overtime pay for salaried employees using the time and a half formula above.<\/p>\n Using an overtime tracker<\/strong> can be an effective way to keep track of time tracking<\/a> in your company. Having a reliable system for keeping an accurate record of employee time and attendance<\/a> is especially relevant with the increasing popularity of flexible working hours and remote work<\/strong>. It helps you keep on top of the hours worked by each employee. It also helps you comply with legal obligations relating to time tracking, working hours, and breaks.<\/p>\n With Factorial\u2019s downloadable overtime tracker Excel template<\/a>, you can manage your employees\u2019 time and attendance from a simple spreadsheet.<\/strong> Your employees can use them to keep track of their daily working hours, breaks, and overtime. This makes it much easier for you to calculate payroll at the end of each pay period.<\/p>\n Using an overtime tracker Excel can be a great solution for keeping track of time and a half. However, entering data in Excel can become a tedious task and can take up a lot of precious time.<\/p>\n Why not save yourself the headache of managing employee hours<\/strong> and let Factorial keep you on track with its time attendance software<\/a>? Our time tracking software can help you improve your workforce management. And it’s a great way to ensure you have accurate<\/strong> and up-to-date records<\/strong> at all times.<\/p>\n Factorial’s cloud-based software allows you to automate and digitize your company’s time & attendance<\/strong>. Our simple and intuitive time tracking app<\/a> allows employees to clock in\/out from their mobile app or using a QR code through the entrance app. You can review overtime hours for each employee at the click of a button. You can also extract reports so you can keep better track of employee hours<\/strong> and control labor costs<\/strong>. Plus, the app uses geofencing features<\/a> to monitor if your employees clock in\/out from outside the workplace. And at the end of the month, managers can review and approve timesheets before you process payroll<\/strong>. Simple!\n
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<\/a><\/h2>\n<\/a>What is Time and a Half?<\/h2>\n
<\/a>How Does Time and a Half Work?<\/h2>\n
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<\/a>Time and A Half Exemptions<\/h2>\n
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<\/a><\/h2>\n<\/a>How to Calculate Time and a Half<\/h2>\n
<\/a>Tracking Overtime Hours in Excel<\/h2>\n
<\/a>How to Keep Track of Overtime Hours with Software<\/h2>\n
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