SmartOvertime

Frequently Asked Questions

Find answers to the most common questions about overtime pay, PTO (paid time off), calculation methods, and employee rights.

GENERAL

General Overtime Questions

Overtime pay is the additional compensation employers must pay to eligible employees who work more than the standard number of hours in a workweek. Under the federal Fair Labor Standards Act (FLSA), overtime is 1.5 times (time and a half) the employee's regular hourly rate for hours worked beyond 40 in a workweek.

Most hourly (non-exempt) employees are eligible for overtime under the FLSA. Salaried employees may also qualify if they earn below the current salary threshold ($35,568/year) or do not meet the duties tests for executive, administrative, or professional exemptions. Independent contractors are not covered.

The standard overtime rate is 1.5× your regular hourly rate. For example, if you earn $20/hour, your overtime rate is $30/hour. Some states like California also require double time (2×) after certain daily thresholds.

Double time means you are paid 2× your regular hourly rate. Currently, only California mandates double time: after 12 hours in a single workday, or for all hours on the 7th consecutive workday in a workweek. Other states follow the federal 1.5× rule only.

Yes. While most states follow the federal FLSA standard (overtime after 40 hours/week at 1.5×), some states have stricter rules. California, Alaska, Colorado, and Nevada have daily overtime thresholds. Kansas and Minnesota have non-standard weekly thresholds for certain employers.

Yes. Overtime eligibility is based on hours worked, not employment status. If a part-time employee works more than 40 hours in a week (or exceeds the applicable state daily threshold), they are entitled to overtime pay at 1.5× their regular rate.

BY STATE

State-Specific Overtime Rules

Four states have daily overtime rules: California (after 8 hours/day, with double time after 12 hours), Alaska (after 8 hours/day), Colorado (after 12 hours/day or 12 consecutive hours), and Nevada (after 8 hours/day, but only for employees earning less than 1.5× minimum wage).

Most states (46 out of 50) use the federal 40-hour weekly overtime threshold. Kansas state law sets 46 hours/week and Minnesota sets 48 hours/week for employers not covered by FLSA, though most employers still follow the federal 40-hour rule. Use our state-specific calculators to check your state's rules.

When state and federal overtime laws differ, the law that provides the greater benefit to the employee applies. For example, a California worker who works 10 hours in a day but only 35 hours in the week still earns daily overtime under state law, even though they haven't hit the 40-hour federal threshold.

California has the most employee-friendly overtime rules in the country: daily overtime after 8 hours, double time after 12 hours, and special rules for the 7th consecutive day of work. California's exemption tests are also stricter than federal FLSA.

17 states (including Alabama, Arizona, Georgia, Louisiana, and others) have no state-specific overtime law. In these states, workers are protected solely by the federal FLSA, which requires 1.5× pay after 40 hours per workweek.

CALCULATION

Overtime Calculation Methods

Divide your annual salary by 52 (weeks), then divide by 40 (hours). For example: $60,000 ÷ 52 ÷ 40 = $28.85/hour.

Non-discretionary bonuses (earned by meeting targets) must be included in the regular rate for overtime calculation. Discretionary bonuses (holiday gifts) are typically excluded.

Overtime is calculated on gross (pre-tax) pay. Your total earnings including overtime are then subject to normal tax withholding.

Private sector employers generally cannot substitute comp time for overtime pay. Public sector employers may offer comp time at 1.5 hours for each overtime hour.

PTO & PAID TIME OFF

PTO & Paid Time Off

Enter your state, accrual method (per pay period, per hour worked, or annual lump sum), annual PTO hours, and optional fields like current balance and hourly rate. The calculator shows your accrual per period, annual accrual, available balance, and—if you enter an hourly rate—your PTO dollar value and estimated payout on termination. State-specific PTO payout rules are displayed based on your selection.

PTO accrual is the rate at which you earn paid time off. Common methods include: per pay period (e.g., a fixed number of hours each biweekly check), per hour worked (typical for part-time jobs), or annual lump sum (full allowance granted at once). Your employer's handbook or HR can confirm which method your company uses.

It depends on your state. States like California, Colorado, Illinois, Louisiana, Massachusetts, Nebraska, New Mexico, and North Dakota require employers to pay out earned, unused PTO at separation. In other states, payout depends on your employer's written policy or is not required by law. Use the state selector in the calculator to see your state's rule.

Use-it-or-lose-it means unused PTO is forfeited at year-end or when employment ends. Some states prohibit this (e.g., California, Montana, Nebraska); others allow it under conditions. The calculator shows your state's use-it-or-lose-it status.

Yes. Choose "Per hour worked" as the accrual method and enter your typical hours per week. The calculator will compute how much PTO you accrue per hour worked and per pay period.

Yes. The PTO calculator is 100% free with no sign-up and no data stored. All calculations run in your browser.

Divide your annual PTO hours by the number of pay periods per year for per-period accrual (e.g., 80 ÷ 26 ≈ 3.08 hours per biweekly period). For per-hour-worked accrual, divide annual PTO by your annual hours worked (e.g., 80 ÷ 2,080 ≈ 0.0385 hours per hour). Use the calculator above to try different methods and see a full-year breakdown.

Per pay period accrual gives you a fixed amount of PTO each pay period (e.g., 4.6 hours every two weeks). Per hour worked accrual ties PTO to the hours you actually work—common for part-time or variable schedules. Both can add up to the same annual total; the method affects when and how you earn it.

Check your offer letter, employee handbook, or HR portal. Many employers offer 10–15 days (80–120 hours) per year for full-time employees, with increases based on tenure.

Yes. Accrual math is the same regardless of state. State laws mainly affect whether unused PTO must be paid out at termination and whether use-it-or-lose-it is allowed—use the main PTO calculator or PTO payout calculator for state-specific payout rules.

Gross payout = unused PTO hours × your hourly rate. Employers typically withhold federal income tax at about 22% on PTO payout (supplemental wages), so your estimated net is gross minus that tax. Use the calculator above to enter your unused hours and rate and see the estimate for your state.

The IRS treats PTO payout as supplemental wages. Employers typically withhold federal income tax at a flat 22% rate on supplemental wages (up to $1 million per year). Your actual tax may vary based on your total income; this calculator gives an estimate only.

In states with mandatory PTO payout (e.g., California, Illinois, Massachusetts), employers must pay all earned, unused vacation/PTO when employment ends—whether you quit or are terminated. In other states, payout depends on your employer's written policy or is not required.

A common method is to divide your annual salary by 2,080 (40 hours × 52 weeks). Enter your annual salary in the calculator and it will compute the equivalent hourly rate for the payout estimate.