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Aug05

Non-exempt Holiday Pay

If a salaried non-exempt employee works 35 hours from Monday to Thursdays and Friday is a paid holiday is the work week considered 32 hours because of the paid holiday and the extra 3 hours they worked paid at the overtime rate of 1 1/2 pay? The formula would look like; 32 x straight + 3 x 1 1/2 + 8 straight holiday. Or is the worker paid straight time for the extra 3 hours? So, they would get paid 35 hours straight time plus 8 hour paid holiday for a total of 43 straight time hours.

Absent a collective bargaining agreement or other contract providing paid holidays, federal law does not require employers to pay non-exempt employees for holidays that they do not actually work. Many employers offer the benefit of paid holidays to promote employee goodwill.

The federal Fair Labor Standards Act (FLSA) requires employers to pay overtime to non-exempt employees at time and one-half their regular rate of pay for all hours actually worked over 40 in a given workweek. Thus, the employee in question should receive their regular rate of pay for all 43 hours, 35 hours straight time plus 8 hours holiday. The reason being is because the additional 3 hours worked totaled 38 hours actually worked in the workweek. The holiday pay is not considered time actually worked; so, no overtime pay is required.

This entry was posted on Tuesday, August 5th, 2014 at 8:58 pm and is filed under
Compensation.
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