How do you calculate overtime pay in Georgia?

Calculating overtime pay can be crucial to managing employee compensation and ensuring compliance with labor laws. In Georgia, the process for calculating overtime follows federal guidelines, which help standardize how extra work hours are compensated. Understanding the basics of how to calculate overtime pay ensures that employees are fairly paid for their additional work while assisting employers to avoid potential legal issues.

This article provides the essential steps involved in calculating overtime pay.

Which Overtime Laws Apply in Georgia?

Georgia does not have its state-specific overtime laws. In Georgia, overtime laws are governed primarily by the Fair Labor Standards Act (FLSA). The FLSA mandates:

• Non-exempt employees must receive overtime pay at a rate of one and a half times their regular rate of pay for hours worked beyond 40 in a workweek.
• Certain employees are exempt from overtime pay under the FLSA, including those in executive, administrative, professional, and outside sales roles and certain highly compensated employees. These exemptions are subject to specific criteria related to job duties and salary levels.
• Overtime is not required for weekends, nights, or holidays unless additional hours are worked during those times.

How Much is Overtime Pay in Georgia?

Overtime pay in Georgia is calculated based on the FLSA standards. Employees who are eligible for overtime under the FLSA must be paid at a rate of one and a half times (1.5) their regular hourly wage for any hours worked beyond 40 in a workweek. For instance, if an employee’s regular hourly rate is $20, their overtime rate would be $30 per hour ($20 x 1.5).

To learn more, check out our guide on Georgia Overtime Laws. 

Who is Eligible for Overtime Pay in Georgia?

Most employees who are not classified as exempt are eligible for overtime pay. This includes many hourly employees and salaried employees who do not meet the exempt criteria.

Check out our guide on Overtime Rights in Georgia.

Calculating overtime for hourly employees in Georgia involves determining the pay rate for hours worked beyond the standard 40-hour workweek. To calculate, employers must:

• Determine the regular rate: An hourly employee’s regular rate of pay is simply their hourly rate. If an employee is paid $7.25 per hour, that is also their regular rate.
• Calculate overtime rate: Multiply the employee’s regular hourly rate by one and a half times. So, if the employee’s hourly rate is $7.25, their overtime rate would be $10.88 ($7.25 x 1.5).
• Identify overtime hours: Overtime hours are those worked beyond 40. For example, if an employee works 45 hours a week, the overtime is 5 (45 – 40).
• Compute overtime pay: Multiply the overtime rate by the additional hours worked. In this example, the employee worked an additional five hours, entitled them to $54.40 ($10.88 x 5).

Read our guide on Your Rights as an Hourly Employee in Georgia to learn more.

Overtime for salaried employees depends on their classification, whether they are classified as exempt or non-exempt under FLSA regulations. In Georgia, non-exempt employees who work beyond 40 hours in a workweek are entitled to overtime compensation. To calculate, employers must:

• Determine the weekly salary: Salaried employees are paid a predetermined, fixed amount for the entire workweek. For example, if a salaried employee earns $750 weekly.
• Calculate the regular rate of pay: Convert the weekly salary to an hourly rate by dividing by 40 (standard workweek hours). If an employee earns $750, their regular hourly rate would be $18.75 per hour ($750 / 40).
• Get the overtime rate: The overtime rate is one and a half times their regular hourly rate. If employees earn $18.75 per hour, their overtime rate would be $28.13 per additional hour over 40 in a workweek ($18.75 x .1.5).
• Identify the overtime hours: Determine the number of overtime hours worked. Overtime hours are considered when the hours worked go beyond 40 in a workweek. If the employee worked 48 hours, the overtime hours are 8 (48 – 40).
• Calculate overtime pay: Multiply the overtime hours by the overtime rate. If the employee worked eight overtime hours with an overtime rate of $28.13 per additional hour, the employee will receive $225.04 ($28.13 x 8).

Check out our guide on Your Rights as a Salaried Employee in Georgia.

To calculate the total overtime compensation for commission-based employees, employers must:

• Determine the total weekly compensation: Total earnings include the employee’s base salary and commission earnings. For example, if an employee earns a base salary of $500 per week and receives $250 in commissions, their total weekly compensation is $750.
• Calculate the regular hourly rate: Track the total hours worked in the week. Divide the total compensation by the hours worked to determine the regular pay rate. For example, if the employee worked 50 hours a week, the regular hourly rate would be $15 ($750 / 50).
• Calculate the overtime rate: The employee’s overtime rate is 1.5 times their regular pay rate. Using the example above, if an employee is paid $15 per hour, the overtime rate would be $22.5 ($15 x 1.5).
• Determine the overtime hours: Any hours worked over 40 in a workweek are counted as overtime. If the employee worked 50 hours, the overtime hours are 10 (50 – 40).
• Calculate overtime pay: Multiply the overtime hours by the overtime rate. In this example, the employee would receive $225 ($22.5 x 10) for the additional hours worked.

Piece rate employees are paid based on the number of items they produce or tasks they complete rather than hourly wages. To calculate overtime pay for piece rates employees in Georgia, employers must;

• Determine the total earnings: Calculate the total piece rate earnings for the workweek. For example, if an employee earns $8 per piece and produces 100 pieces, the employee’s total earnings would be $800.
• Calculate the regular rate of pay: Determine the total hours worked during the workweek. Divide the total earnings by the total hours worked. For example, if the employee worked 50 hours and earned $800 for the week, the regular rate of pay would be $16 per hour ($800 / 50).
• Calculate the overtime rate: Multiply the regular hourly rate by 1.5 to get the overtime rate. If the employee’s regular rate is $16 per hour, the overtime rate would be $24 ($16 x 1.5).
• Calculate the overtime pay: Multiply the overtime rate by the overtime hours worked. Any hours worked beyond 40 is considered overtime. In the example above, the employee worked 50 hours in the week. The employee worked ten hours, and their overtime pay would be $240 ($24 x 10).

In Georgia, the statute of limitations for claiming unpaid overtime under the FLSA is typically two years from when the wages were due. However, if the employer’s violation was found willful, the statute of limitations extends to three years.

Employees pursuing a claim for unpaid overtime are advised to act promptly to meet all deadlines.

Employers in Georgia are required to maintain accurate records of their employees’ work hours and wages to comply with overtime wage regulations under the FLSA. Here are the key recordkeeping requirements:

• Time records: Employers must keep detailed records of the hours worked by each employee. This includes each workday’s start and end times and any meal or rest breaks.
• Wages: Employers must record the total wages paid to each employee during each pay period. This includes regular wages, overtime pay, and other compensation forms.
• Employee information: Employers should maintain records that include the employee’s name, address, occupation, and the period they are employed.
• Retention period: Employers should keep all records for at least three years from the date of the last entry. This includes time cards, work schedules, and records of wage deductions.