Overtime Rules Setup

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An overtime rule says when regular hours become overtime or double time. Setup > Company > Overtime Rules lists your rules; each rule is a card you can edit.

A rule’s settings #

  • Rule name and Active.
  • Starting point – pick Federal (FLSA), California, Alaska, Colorado, Nevada or No overtime to fill in the numbers below. These are only starting points; overtime law changes, so check your state’s current rules and adjust.
  • Daily overtime after – hours in a day after which the rest are overtime. 0 means no daily overtime.
  • Double time after – hours in a day after which the rest are double time. 0 means none.
  • Weekly overtime after – hours in a workweek after which the rest are overtime (40 for the federal rule).
  • Workweek starts – the day your workweek begins.
  • Seventh day – on the 7th consecutive day worked in a workweek, the first 8 hours are overtime and anything beyond is double time (as in California).
  • Paid as – the pay codes used for overtime and double time. Left alone, the first Overtime and Double Time codes are used.
  • Company default – use this rule for every employee who has no rule of their own or via a group. Only one rule can be the default.
  • Who it applies to – check groups and/or individual employees.
An overtime rule card: Federal Overtime (40 hours) set as the company default

Which rule an employee gets #

  1. A rule assigned to the employee by name;
  2. otherwise a rule assigned to one of their groups;
  3. otherwise the company default rule;
  4. otherwise no overtime.

Employees marked Exempt from overtime on their Payroll tab never get overtime.

What counts #

  • Only Regular hours count toward the thresholds and convert. Leave, holiday, premium and other pay is never counted as time worked for overtime.
  • Daily thresholds apply first; the weekly threshold then applies to the regular hours that remain, so no hour is counted twice.
  • A workweek that straddles two pay periods is evaluated as a whole week, so a weekly threshold is not reset by a pay period boundary.
  • If a day mixes work types, the overtime hours are taken from the last work type recorded that day.

Seeing the result #

Tick Apply overtime rules on the Hours by Work Type report to see regular and overtime hours. Pay runs always apply the rules.

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