What are the rules for paying salary employees overtime?
In Arizona, salary employees must be paid overtime when they work over 40 hours per week. Arizona state law follows the federal Fair Labor Standards Act (FLSA). Under the FLSA, employers must pay overtime at 1.5 times the employee’s regular rate of pay for all hours worked over 40 per week. For example, if an employee is paid a salary of $800 per week, their regular rate of pay would be $20 per hour. If they worked 45 hours, they would be owed 5 hours of overtime at 1.5 times their regular rate, or $30 per hour. Their total pay for that week would be $900 (the salary of $800 plus the overtime pay of $100). Employees in Arizona who are classified as exempt from the overtime provisions of the FLSA are not eligible for overtime pay. Exempt employees include executive, administrative, and professional employees, such as lawyers, doctors, and nurse practitioners, who have a specific job title and meet certain duties tests. In addition, employers must pay a minimum wage to all employees in Arizona. As of 2021, the minimum wage is $12.15 per hour. Employers must also pay employees any tips they earn. Overall, Arizona employers must follow the rules of the FLSA to ensure that salary employees receive overtime pay when they work more than 40 hours per week.
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