Overtime rules are (needlessly) complicated. The complexity often prevents workers from understanding that they are being underpaid – which may be the point. But if you know your rights, it’s easier to detect when something’s wrong on that paystub. Below is a guide to reading your paystub. Please note that the rules are seriously more complex than what we can cover in this blog post – so if you think something’s wrong, ask your Union Rep or a Workplace Lawyer!
1) The baseline: federal overtime under the FLSA
At the federal level, most non‑exempt employees must be paid at least time‑and‑a‑half of their “regular rate” for hours worked over 40 in a workweek. That rule lives in 29 U.S.C. § 207(a) and the U.S. Department of Labor’s interpretive regs at 29 C.F.R. Part 778, which also explain how to compute the “regular rate” (for example, what compensation is included or excluded, how bonuses and differentials affect the average).
Key points about the federal regular rate calculation:
- The regular rate generally includes non‑discretionary bonuses, shift differentials, and some other forms of pay; certain “perks” can be excluded. See DOL’s Part 778 interpretations and its regular‑rate fact sheet: https://www.dol.gov/agencies/whd/fact-sheets/56a-regular-rate
- The FLSA typically does not require daily overtime (e.g., after 8 hours in a day) unless a special rule applies (see “Hospitals and nursing homes” below).
Exemptions. Executive, administrative, professional, outside sales, and certain computer employees can be exempt from overtime if duties tests are met and the employee is paid on a salary basis at or above the applicable threshold. The rules are in 29 C.F.R. Part 541.
Pending/contested federal rule: In 2024, DOL finalized increases to the Part 541 salary thresholds, effective July 1, 2024 and January 1, 2025, but a federal court vacated the rule, and DOL says it’s currently enforcing the 2019 threshold ($684/week) while litigation and an appeal proceed.
2) New York’s overtime rules (and where they differ)
New York’s wage orders incorporate FLSA overtime concepts but add important state‑specific requirements.
- General rule (most industries). In New York’s Miscellaneous Industries & Occupations Wage Order, employers must pay 1.5× the employee’s regular rate for hours over 40 each workweek; employees who work in a residence have a 44‑hour weekly threshold. See 12 NYCRR § 142‑2.2.
- Call‑in pay. If you report to work at your employer’s request or permission, you’re owed at least 4 hours at the basic minimum wage (or the length of your scheduled shift if shorter). See 12 NYCRR § 142‑2.3.
- “Spread of hours.” Extra pay (one additional hour at the basic minimum wage) can be due when the workday’s “spread” exceeds 10 hours; details vary by wage order (not part of the federal FLSA). For restaurants/all‑year hotels, see 12 NYCRR § 146‑1.6; for most other industries, see 12 NYCRR § 142‑2.4.
New York exemptions and salary thresholds. New York sets state‑specific minimum salary thresholds for the executive and administrative exemptions (duties tests still apply). As of January 1, 2026, the weekly minimum is $1,275.00 in NYC, Long Island, and Westchester; $1,199.10 elsewhere in the state. New York does not set a higher salary threshold for the professional exemption—so the federal $684/week (pending litigation updates) governs that salary floor in practice.
3) How to calculate overtime correctly
Step‑by‑step (federal/NY general rule):
- Determine total “hours worked” this workweek (including certain job‑related activities even if off‑site).
- Compute the regular rate: total straight‑time compensation ÷ total hours worked; include non‑discretionary bonuses and shift differentials; exclude items DOL says you may exclude.
- Overtime due = (regular rate × 1.5) × overtime hours.
Tipped hospitality employees. New York requires you calculate the overtime rate on the pre‑tip‑credit regular rate, then subtract the tip credit. The state gives explicit examples in 12 NYCRR § 146‑1.4.
4) Industry‑specific rules that matter in New York
A) Hospitality (restaurants and hotels)
- Overtime: 1.5× the regular rate after 40 hours; tipped workers’ OT is computed on the pre‑credit rate, then the tip credit is subtracted. See 12 NYCRR §§ 142-2.2 and 146‑1.4.
- Spread‑of‑hours: Spread of hours refers to the total time from the beginning to the end of an employee’s workday, including working hours and any breaks. If you’re a restaurant worker and your daily spread of hours exceeds 10 hours, or you work a split shift, you’re owed one extra hour at the basic minimum wage. See 12 NYCRR § §142-2.4 and 146‑1.6.
B) Firefighters and police (public agencies)
Public fire and law enforcement personnel can be scheduled under the FLSA § 7(k) work‑period system. Overtime kicks in after 212 hours in 28 days for fire and 171 hours in 28 days for law enforcement, or proportionally for shorter work periods (e.g., 53 hours for a 7‑day fire work period). See 29 C.F.R. §§ 553.201, 553.230.
Small departments may fall under a separate complete exemption if they have fewer than five employees in fire or law enforcement that week. See 29 C.F.R. § 553.200(b).
C) Hospitals, nursing homes, and residential care: the “8/80” option
Hospitals and residential care establishments may, by prior agreement, use a fixed 14‑day work period and pay overtime for hours over 8 in a day or over 80 in the 14 days. This is the FLSA’s § 7(j) system. 29 C.F.R. §778.601.
Note: employers must follow 29 C.F.R. Part 778 rules on regular‑rate calculations; daily overtime under 8/80 can be credited toward 80‑hour OT in the 14‑day period.
D) Nurses: New York limits mandatory overtime
New York Labor Law § 167 restricts covered health‑care employers from requiring nurses (RNs/LPNs) to work beyond their regularly scheduled hours, except during defined emergencies (health‑care disaster, declared emergency, unforeseen emergency necessary for safe patient care, or when a nurse must remain to complete an ongoing procedure). Recent amendments add reporting, posting, and “good‑faith effort” requirements.
The NYSED Board for Nursing also warns about professional conduct concerns with excessive voluntary hours; see its workplace guidance: https://www.op.nysed.gov/professions/licensed-practical-nurses/workplace-information
E) Farmworkers: a phased path down to 40 hours
Under the Farm Laborers Fair Labor Practices Act and the Commissioner’s 2023 order adopting the Wage Board’s recommendation, New York is lowering the farm overtime threshold every other year until it hits 40 hours in 2032. As of January 1, 2026, farmworker overtime begins after 52 hours in a workweek (down from 56). The Department of Labor confirms the schedule.
5) Employers often make the following mistakes, so watch your paystubs!
- Misclassifying employees as exempt without meeting both duties and salary basis requirements (and, in New York, the state salary floor for exec/administrative).
- Regular‑rate errors: excluding non‑discretionary bonuses or shift differentials from the regular rate, which underpays OT.
- Tipped OT miscalculations in hospitality: subtracting tip credit before applying the 1.5 multiplier (New York specifically prohibits that).
- Ignoring call‑in or spread‑of‑hours pay obligations under New York wage orders.
6) Proposed or pending changes you should watch
- Federal EAP salary thresholds (Part 541): DOL’s 2024 rule raising salary levels is vacated in one court and on appeal; DOL says it’s enforcing the 2019 threshold for now. If the litigation changes that, thresholds may rise. Watch this space.
- New York annual minimum wage adjustments starting 2027: Future increases will be tied to regional consumer price index averages; this can indirectly affect call‑in/spread‑of‑hours amounts and wage‑order credits.
Don’t wait for permission to be paid correctly.
If you’re working overtime in New York, the law isn’t a suggestion—it’s a payroll obligation. If your employer is cutting corners on regular‑rate calculations, misusing tip credits, or hiding behind bogus “exempt” labels, stand up for your rights. If you’ve got questions about how these rules apply to your job, talk to a workers’ rights attorney in your jurisdiction—and do it before smaller errors become bigger losses.
