The law protects the right of workers to earn at least minimum wage, which is a baseline amount of pay per hour worked. Hourly workers generally have the right to compensation for all time worked, as well as the right to overtime in certain circumstances.
Overtime pay involves companies providing 150% or more of an employee’s standard hourly rate because they worked 40 hours or more in a single workweek. The extra staffing costs associated with overtime can increase operating expenses and reduce the company’s profit margins.
If an employer has an internal policy prohibiting overtime or requiring specific pre-approval, can employers refuse to pay overtime wages that hourly and non-exempt workers have earned?
Internal policies guide scheduling, not payroll
Employers control how many workers they hire and how many hours each employee has to work. Most of the time, they are under no direct obligation to schedule workers for a certain number of hours. They also have no legal requirement to allow workers to put in more than 40 hours.
However, if employees are on the clock for long enough to qualify for overtime, then employers have a legal obligation to pay them in accordance with the law. The company’s policy prohibiting overtime does not justify a refusal to pay a worker’s earned wages or to alter their time clock records so that they appear to have worked 40 hours or less.
Employees denied the overtime wages they have already earned may potentially have grounds for a wage claim. Documenting time worked and comparing those records with paychecks can help professionals to better ensure they receive the pay they’ve earned because they have worked longer than usual.