Calculating Overtime and Back Pay in Pennsylvania: Know these Quirks in the Law or Risk Losing Money

Pennsylvania law differs from federal law

Do you get overtime?

If not, and you think you may be entitled to it, there are several things to keep in mind.

First, it’s important to be aware of what federal law says about who is and isn’t eligible for overtime. (We’ll get to that in a minute.)

Beyond that, it’s important to know how your state calculates overtime, or you could end up getting seriously shortchanged in terms of back pay. That’s because some states, such as Pennsylvania, take a different approach to overtime compensation than the federal government does.

Let’s take a look at what you need to know.

How do you know if you’re eligible for OT?

The first thing you need to consider is how you’re classified in terms of payroll.

A non-exempt employee is someone who is eligible for overtime. An exempt employee is not. Think of it this way: The exempt employee is exempt from overtime.

Keep in mind that employers don’t get to pick and choose how they want to classify you. Rather, federal law has some very specific guidelines that employers must comply with. (Check out our guide on how to determine your status.)

What if you’ve been misclassified?

If you believe that you’ve been misclassified, your company may owe you back pay for overtime.

Here’s where things can get complicated. Federal law allows something called a “fluctuating workweek” (FWW) model.

The FWW model is often used to compute overtime for salaried employees who are eligible for overtime and who work a different number of hours each week. For example, a retail manager may be salaried but also considered non-exempt. (You can find a more in-depth explanation of the FWW model here.)

This method often doesn’t work out in employees’ favor. In fact, the more hours they work, the more diluted their hourly rate can become.

You can imagine that employers often like this model.

FWW Not a Recognized Method of Paying Overtime Under PA Law

Courts in Pennsylvania have held that FWW is not a permissible way of calculating overtime under Pennsylvania law. However, that doesn’t mean employers won’t attempt to use it when calculating overtime or back pay awards.

After all, many employees are not aware of the nuances of federal and state wage and hour law, so they may be likely to accept their back pay awards and not question the totals.

However, the Pennsylvania Minimum Wage Act (PMWA) states that employees are entitled to 1.5 times their regular hourly base rate of pay for any hours worked over 40 in a given workweek.

For example, in Pennsylvania, if a worker makes $10 an hour for hours 1-40, he or she should make $15 an hour for hours 41-50.

Contact the Murphy Law Group Now for a Free Consultation

If you feel that you haven’t been paid in accordance with the law, it’s a good idea to speak to an attorney.

Email us at murphy@phillyemploymentlawyer.com, or call (267) 273-1054 for a free consultation.