Louisiana Overtime Laws

September 15th 2024

Similar to federal law, the Louisiana Labor Law ensures that eligible employees receive appropriate compensation for their extra hours of work. These provisions aim to protect workers’ rights, promote fair labor practices, and maintain a balanced employer-employee relationship. 

In Louisiana, if an employee works more than 40 hours in a week, they are entitled to receive overtime pay at one and a half times their regular rate of pay.

This article will provide information to successfully navigate Louisiana’s overtime regulations, whether you’re an employer aiming for compliance or an employee defending your rights.

This article covers:

Louisiana Overtime Rates

Louisiana regulates overtime based on the federal Fair Labor Standards Act (FLSA). For any hours worked beyond a total of 40 in one work week, the majority of hourly employees in Louisiana have the right to an overtime pay rate.

Overtime in Louisiana is set at 1.5 times the regular hourly rate. Since the regular Louisiana minimum wage is $7.25 per hour, this makes Louisiana’s overtime minimum wage $10.88 per hour.

Overtime Entitlement in Louisiana

According to Louisiana overtime laws, overtime pay is required for any non-exempt employees. 

An employee who earns below $844 a week ($43,888 per year) and works in a non-exempt industry is entitled to overtime pay.

However, an employee’s overall eligibility for overtime pay will be based on what the job duties are as well as what type of business they are in.

For a deeper understanding, read our detailed articles on Overtime Rights in Louisiana and Overtime Exceptions and Exemptions in Louisiana.

Mandatory Overtime in Louisiana

In Louisiana, employers can enforce mandatory overtime for their employees.

While employers are advised to take into consideration the needs of their employees when allocating overtime hours, it’s not always possible to predict when overtime may be required. An employer is well within their rights to mandate overtime, even if it can be troubling for an employee.

It is an employee’s responsibility to enquire about any necessary overtime requirements for their employment. Employees who are unable to work such additional hours should look for another position that would better fit their schedule. 

It is important to note that refusing to work mandatory overtime can lead to disciplinary action against the employee who resists.

Overtime for Tipped Employees in Louisiana

In Louisiana, the overtime rate for tipped employees is 1.5 times their regular wage for every overtime hour worked. However, the use of a “tip credit” system, which permits employers to pay tipped employees a reduced minimum wage, is permitted by both state and federal legislation. 

That being said, an employer cannot include that tip credit in the calculation of overtime pay. This means that the entire minimum wage (i.e. $7.25) must be taken into account when calculating overtime pay.

Overtime for Salaried Employees in Louisiana

In Louisiana, some salaried employees are entitled to overtime pay. A salaried employee is someone who receives a set amount of pay regardless of how many hours they work. 

To determine a salaried employee’s overtime rate, an employer must first determine their employee’s hourly rate, which can be calculated using the following method:

Annual Salary divided by 52 weeks = Weekly Pay

Weekly Pay divided by 40 hours = Hourly Pay Rate

Then, take the hourly pay rate to calculate the overtime rate for salaried employees using the following formula:

Hourly pay rate x Overtime Hours x Overtime Rate (1.5)

It is important to note that if an employee’s salary covers less than 40 (hours) in a workweek, their regular rate will be added for every subsequent hour working up to the 40. Only after 40 hours will time-and-a-half be counted.

If an employee’s salary covers 40 (hours) in a workweek, then time-and-a-half will be paid for any hours over 40.

Calculating Overtime with Commission in Louisiana

Employees in Louisiana who receive commissions are eligible for overtime at a rate of 1.5 times their regular hourly rate. Their regular hourly rate must include the commissions earned as well. However, they will only be given half of that rate for every overtime hour.

For example, let’s say an employee works 45 hours a week at a rate of $7.25/hour (Louisiana minimum wage) and receives $50 in commissions for that week. We need first to calculate the new regular hourly rate: 

(Total hours x Hourly Rate) + Commission

= (45 x 7.25) + 50

= $376.25

Then, divide that by the total hours worked in the week.

= 376.25 / 45

=$8.36 (new regular hourly rate)

To determine the overtime rate for the commissioned employees, we need to take that new regular hourly rate and halve it.

$8.36 / 2

= $4.18

Since the employee worked an extra 5 hours in the week, that makes his overtime compensation $20.90 ($4.18 x 5 hours).

The amount will vary according to the hours worked, hourly rate, and commission earned.

Overtime Exceptions and Exemptions in Louisiana

Despite the purpose of overtime laws being to safeguard workers against employer exploitation, certain groups and professions have exceptions to these regulations due to their lower likelihood of being exploited. As stated by the FLSA, the following employees are exempt from overtime laws:

  • Executive, administrative, and professional employees earning a minimum of $844 per week
  • Outside sales employees
  • Transportation workers
  • Agricultural and farm workers
  • Live-in employees such as housekeepers

Statute of Limitations For Unpaid Overtime Claims in Louisiana

According to Louisiana overtime laws, employers can be held liable for any unpaid overtime wages for 2 years from the date on which the wages were earned.

However, for willful overtime violations by an employer, the statute of limitations can increase to 3 years.

Legal Cases Relating to Overtime Compensation in Louisiana

Below, we present law cases relating to fair overtime compensation for employees in Louisiana: 

1. Organ Procurement Coordinator Seeks Compensation for Overtime Hours Worked

In the case of Smith v. Ochsner Health System, Daniel Smith filed a lawsuit against his former employer, Ochsner Health System (Ochsner), for allegedly not providing him with compensation for the overtime hours he worked. Smith was hired as an organ procurement coordinator and was responsible for being the main point of contact between the hospital and the Louisiana Organ Procurement Agency. 

Smith’s duties included evaluating potential organ donors, communicating with surgeons, arranging transportation for organs, and completing necessary reports. Smith claimed that this demanding workload was stressful and led to health issues, eventually forcing him to resign.

Ochsner argued that Smith was exempt from overtime pay under the Fair Labor Standards Act (FLSA) as he was a highly compensated and also administrative employee. The court examined the highly compensated employee (HCE) exemption and its requirements and noted that Smith met them.

The following analysis was whether Smith was exempt as an administrative employee. Ochsner claimed that Smith’s role as an organ procurement coordinator involved activities that were directly related to the hospital’s operations. Smith argued that his involvement in procurement was minimal and should not be considered as exempt.

After considering the arguments from both Smith and Ochsner, the court concluded that Smith did not meet the criteria for entitlement to overtime pay under the FLSA. As a result, the court ruled in favor of Ochsner.

Key lessons from this case:
  • The HCE exemption applies to employees who meet specific criteria, including being compensated at least $100,000 annually, regularly performing exempt duties, and engaging in office or non-manual work as their primary duty.
  • The administrative employee exemption applies to employees whose primary duties involve performing office or non-manual work directly related to the business operations of the employer or the employer’s customers.
  • Employers must ensure that employees meet all the criteria for a claimed exemption to avoid potential liability for unpaid overtime wages.

2. Court Investigates Cable Technicians’ Allegations and Entitlement to Overtime Compensation

In the case of Taylor v. HD and Associates, LLC, Byron Taylor, a cable technician who worked for HD and Associates (HDA), alleged that he and other similarly situated employees did not receive overtime pay as required by the FLSA. HDA is a subcontractor of Cox Communications (Cox) and provides cable and telephone equipment installation and repair services for Cox’s residential customers in Louisiana.

The HDA cable technicians receive work orders directly from Cox based on customer service requests. Cox and HDA use a digital platform to manage work orders, track technician locations, and update routes and assignments. The court uses the bona fide exemption to determine the cable technicians’ qualification for overtime exemption. Since HDA was considered a service establishment and met the regular rate of pay requirement, the key question is whether HDA paid technicians a commission.

The court determined that HDA provided commissions to their technicians because their payment was a percentage of the price passed on to customers, tied to the customer’s demands, and incentivized faster work rather than longer hours.

The district court affirms that the cable technicians were considered exempt and were not entitled to overtime pay.

Key lessons from this case:
  • The bona fide exemption is when an employer is a retail or service provider, the regular rate of pay exceeds 1.5 times the minimum hourly rate, and more than half of the compensation is commissions on goods or services.
  • An employer’s business operations, payment structure, and the nature of the employees’ work play a significant role in determining exemption eligibility.
  • If employees receive commissions as a percentage of the price passed on to customers, it can be a factor supporting exemption eligibility.

3. Security Service Provider Accused of Withholding Overtime Wages and Conducting Illegal Wage Deductions

In the case of Fleming v. Elliot Security Solutions, LLC, Daphne Fleming and Brintney Jones filed a lawsuit against their former employer, Elliot Security Solutions (Elliot Security), for violating the Fair Labor Standards Act (FLSA) and the Louisiana Final Wage Payment Act (WPA). 

Fleming worked as a Field Supervisor and was responsible for checking on employees, maintaining paperwork, retrieving and delivering timesheets, and occasionally working as a security guard when needed. Fleming also supervised 40 to 50 employees, trained them, and provided counseling. Jones, however, worked as a Site Supervisor and guided 8 to 10 guards at a job site. She was later transferred to work as a security guard at several other locations. As a Site Supervisor, Jones was responsible for supervisory duties but performed non-supervisory work as a security guard.

Fleming and Jones claimed that Elliot Security failed to pay them overtime wages, made late payments, and did not pay their final wages as required by law. They also claimed that Elliot Security deducted costs for equipment, uniforms, and other expenses from their paychecks which made their pay amount lower than the minimum and overtime wage. However, Elliot Security argued that the deductions were legally permissible, the late payments were minimal and promptly resolved, and they also argued that Fleming was exempt from overtime pay.

The court found that Fleming and Jones failed to provide evidence that the deductions for uniforms and equipment caused their wages to fall below the minimum wage or cut into their overtime pay.

The court granted a partial summary in favor of Elliot Security and dismissed Fleming and Jones’ unpaid overtime wage allegations.

Key lessons from this case:
  • Employers are obligated to pay employees their final wages upon termination or separation from employment, as mandated by state law.
  • Employers should promptly address any late wage payments and ensure timely resolution to avoid potential legal repercussions.
  • The court may grant a partial summary judgment in favor of the employer when the evidence provided by the employees is insufficient to support their claims, resulting in the dismissal of specific allegations.

Learn more about Louisiana Labor Laws through our detailed guide.

Important Cautionary Note

This content is provided for informational purposes only. While we make every effort to ensure the accuracy of the information presented, we cannot guarantee that it is free of errors or omissions. Users are advised to independently verify any critical information and should not solely rely on the content provided.