Understanding overtime versus compensatory time

The Human Resources department has shared the information below to help employees understand the difference between overtime and compensatory (“comp”) time.

Overtime

  • Overtime: Pay non-exempt employees earn at one-and-a-half times their regular rate of pay for hours worked over 40 in a single work week.

Compensatory (“comp”) Time – offered instead of overtime

  • Compensatory Time: Under certain prescribed conditions, employees may receive compensatory time off, at a rate of not less than one and one-half hours for each overtime hour worked over 40 in a single work week, instead of cash overtime pay.  
  • Failure to compensate an employee with identical rates is a violation of the Fair Labor Standards Act (FLSA).

At no time may a supervisor ask an employee to work and not clock in. It is illegal to “Work off the clock.” Fair Labor Standards Act (FLSA), which applies to most workers, requires that employees be paid overtime when working beyond 40 hours a week for all work done for their employers.