Calculating Overtime Pay in Massachusetts: Employer's Guide
Mastering Overtime Pay Compliance in MassachusettsAs an employer in Massachusetts, it's crucial to understand your obligations regarding overtime pay for your workforce. Accurate and compliant overtime calculations are essential to avoid legal issues and ensure fair compensation for your employees. In this guide, we'll provide you with the knowledge you need to navigate Massachusetts overtime laws effectively.
Overtime Pay: Defining a WorkweekIn Massachusetts, both federal and state overtime laws require that non-exempt employees receive overtime pay for hours worked over 40 in a week. To comply with these regulations, it's essential to understand what constitutes a "week" for overtime purposes.
Typically, a workweek runs from Sunday through Saturday for most employers, but it doesn't have to start on a Sunday. The key is that it must consistently start on the same day every week. It's crucial to note that overtime is not averaged over multiple weeks, even if your payroll is bi-weekly. Each week stands alone in determining overtime eligibility. If your employees have varying schedules, such as restaurant or retail workers with different shifts each week, you must track their hours diligently. For instance, if an employee works six shifts between Sunday and Saturday one week and only four the next, the first week's hours may exceed 40. Calculating the Overtime PremiumCalculating the overtime premium for non-exempt employees is relatively straightforward for those paid on an hourly basis. It involves multiplying their regular rate of pay by 1.5 for each hour worked over 40. For example, if an employee's regular hourly rate is $16, their overtime hours should be paid at $24 per hour. However, it's important to understand that even salaried employees may be eligible for overtime if their job duties are non-exempt. In such cases, there are two methods to calculate their overtime rate.
The first method involves dividing the employee's weekly salary by 40 hours to determine their regular rate of pay, which is then multiplied by 1.5 for overtime hours. Alternatively, the "fluctuating workweek" method can be used if specific conditions are met, allowing the employer to pay only a 0.5% premium on top of the regular rate of pay. While paying different hourly rates for travel and service time is legal, employers must ensure that overtime pay accurately reflects the right blend of hours, especially when employees work more than 40 hours a week. Considering Travel Time and PTOPaid time off (PTO), including vacation and sick time, is not considered in overtime calculations. For example, if an employee has 16 hours of paid vacation in a week and works 30 hours, they have not reached the overtime threshold, as PTO hours do not count towards overtime.
If your employees travel between worksites during the day, understanding travel time rules is crucial. Generally, travel from home to the first worksite and from the last worksite home is not considered working time. However, travel between assignments during the workday counts towards the 40-hour threshold. Calculating the overtime rate when employees are paid at different rates for travel time can be more complex. Employers can determine a "blended rate" that reflects the average of travel and actual working time, with overtime premium pay set at 1.5 times that blended rate. |
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Emily Smith-Lee is the owner and founder of slnlaw. She is a 1996 graduate of Boston College Law School. She was previously a partner at the Boston office of a large international firm, where she worked for thirteen years before starting the firm that became slnlaw in 2009. She has been recognized as Massachusetts Superlawyer each year since 2013, and in 2018 earned recognition as one of Massachusetts Lawyers Weekly's Lawyers of the Year. She has written a book on employment law: Rules of the Road, What You Need to Know About Employment Laws in Massachusetts, and helped thousands of clients on both the employee and employer side with severance and non compete review and negotiation, wage and hour, discrimination and retaliation disputes, and advice about employment law generally.
Rebecca Rogers: Rebecca is a 2006 graduate of Boston College Law School, and has worked with slnlaw since 2013. She previously worked as an intellectual property litigation attorney for Fish & Richardson in Boston, Massachusetts, and clerked for the Massachusetts Supreme Judicial Court. Rebecca has helped clients with wage and hour disputes, employment discrimination and retaliation claims, review and negotiation of severance and non compete agreements, and advice to both employees and employers about navigating complex employment situations.
Jenna Ordway: Jenna is a 2013 graduate of Quinnipiac Law School, and also earned an LLM in Taxation from Boston University in 2015. She has been affiliated with slnlaw since 2011, first as a law clerk and then as an attorney. Jenna has been recognized since 2019 as a "Rising Star" by Massachusetts Superlawyers. Jenna has helped clients with review and negotiation of severance and non compete agreements, wage and hour disputes, employment and discrimination claims, and advice to small business owners about employment law and other business matters.
Elijah Bresley: Eli is a 2014 graduate of Seton Hall Law school, and has worked with slnlaw since 2020. He previously worked for a boutique employment law firm outside of Boston, and then for the Labor and Employment department of a large Boston firm. He also spent a year clerking for the judges of the Superior Court in Hartford, Connecticut. Eli has helped clients on the employee and employer side with all varieties of employment law issues, including employment discrimination, retaliation, and wage and hour issues, litigation in MCAD and state and federal courts, and advising employers about employment policies and practices.
Sharleen Tinnin: Sharleen is a 2010 graduate of Northeastern University School of Law, and has been with slnlaw since 2023. Prior to joining slnlaw, she worked with King, Tilden, McEttrick & Brink, P.C. on complex civil litigation matters. She previously worked for the United States Department of Justice, and received an "Excellence in Justice" award in 2017. Sharleen has helped clients with wage and hour, discrimination and retaliation disputes, review and negotiation of severance agreements, and litigation in MCAD and state and federal courts on employment related issues.
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Navigating Massachusetts overtime pay requirements can be challenging for employers. Our expertise ensures that you comply with labor laws, simplify complexities, and maintain legally sound payroll practices. Trust us to help you avoid legal issues while fairly compensating your workforce. You can use the button below to schedule a call back from a member of our team, or give us a call at 781-784-2322.
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