Unpaid Overtime and Wage Claims for Hourly Workers
Federal law sets clear rules for how hourly workers must be paid. When employers do not follow them, the difference comes out of your paycheck. Miscalculated overtime rates, off-the-clock work, and bonus exclusions are among the most common violations, and most workers never find out they are happening.
WORKERS REPRESENTED NATIONWIDE
IN WAGES RECOVERED
CONSULTATION FEE
Your Rights as an Hourly Worker
Hourly workers are protected by the Fair Labor Standards Act and, in many states, additional state wage laws. These laws set minimum standards for how you must be paid. Your employer cannot opt out of them, and you cannot waive them.
An hourly worker is paid a set rate for each hour worked, with total earnings varying based on hours in any given pay period. Hourly pay is common across retail, food service, manufacturing, construction, healthcare, logistics, hospitality, and dozens of other industries. It is also the pay structure with the broadest set of federal protections under the Fair Labor Standards Act.
Hourly workers are protected by federal and, in most states, additional state wage laws. Those laws set minimum standards for how you must be paid. Your employer cannot opt out of them, and you cannot waive them. They apply regardless of your job title, your industry, or how your employer has classified your role.
Key Protections at a Glance
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Overtime Rate
You are entitled to 1.5 times your regular rate for every hour worked past 40 in a workweek.
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Bonuses Count
Non-discretionary bonuses, shift differentials, and certain other pay must be included when calculating your overtime rate.
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Off-the-Clock Work
Pre-shift setup, post-shift cleanup, required trainings, and similar time must be paid - even if it was not on your official schedule.
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Statute of Limitations
The lookback period for unpaid overtime claims is generally two years under federal law, and up to three years if the violation was willful.
What Are Hourly Workers Entitled To?
The core entitlements are straightforward. Your employer must pay you for every hour you work, including time spent before or after your scheduled shift if it is required for the job. They must pay at least the applicable minimum wage for every hour. And they must pay overtime at one and a half times your regular rate for every hour worked past 40 in a workweek. Those rules apply across the board.
- Overtime is owed at one and a half times the regular rate for every hour worked past 40 in a workweek
- The regular rate must include most forms of additional pay, not just the base hourly wage
- Bonuses, shift differentials, and commissions may need to be factored into the overtime rate
- Off-the-clock work, time shaving, and straight-time payment for overtime hours are among the most common violations
- The lookback period for unpaid overtime claims is generally two years, or three years if the violation was willful
How Overtime Is Calculated for Hourly Workers
For most hourly workers, overtime is calculated by multiplying the regular rate by 1.5 for every hour past 40. The regular rate is not always just the base wage, and that is where many employers get it wrong. Federal law requires that the regular rate include most forms of additional compensation paid during the same workweek, including non-discretionary bonuses, shift differentials, and certain other payments. When an employer calculates overtime using only the base rate and leaves those additional payments out, every overtime hour in that pay period is underpaid.
Add Up All Compensation Earned That Week
Start with your total hourly earnings at your usual hourly rate, then add any non-discretionary bonuses, shift differentials, or any other additional pay you received that week. The law requires you to include all additional pay in your total hourly rate when calculating your overtime. Many employers miss this and get it wrong.
Calculate Your True Regular Rate
Divide total weekly earnings by total hours worked. This is your actual regular rate for that pay period. It may be higher than your base wage if you received a bonus or differential that week. This is the number your overtime rate must be based on, not the base wage alone.
Apply the Correct Overtime Rate
Multiply the true regular rate by 1.5. That is the rate owed for every hour worked past 40. If your employer used only the base wage, excluded a bonus, or paid straight time for all hours including overtime, the overtime was underpaid and the difference may be recoverable.
Example 1: Straight-Time Violation - $22/Hour, 55-Hour Week
- What the employer paid: $22 x 55 hours = $1,210 (same rate for all hours)
- Regular-time pay owed: $22 x 40 hours = $880
- Correct overtime rate: $22 x 1.5 = $33 per hour
- Overtime pay owed: $33 x 15 hours = $495
- Correct total: $880 + $495 = $1,375
- Weekly underpayment: $1,375 - $1,210 = $165
Example 2: Bonus Exclusion - $22/Hour + $200 Bonus, 50-Hour Week
- Straight-time earnings: $22 x 50 hours = $1,100
- Total earnings including bonus: $1,100 + $200 = $1,300
- True regular rate: $1,300 / 50 hours = $26 per hour
- Correct overtime premium: $26 / 2 = $13 per overtime hour
- Employer paid overtime at: $22 base rate only (bonus excluded)
- Additional premium owed: 10 overtime hours x $13 = $130
What this means for you
Employers sometimes use procedures that appear routine, pre-approval requirements for overtime, rounding policies, automatic break deductions, or contractor agreements, to reduce what is recorded or paid without workers realizing anything is wrong. If any of these patterns describe your pay, a review of the specific facts can help determine whether a claim may exist.
Common Ways Hourly Workers Are Underpaid
Wage violations against hourly workers take several forms. Some are obvious. Many are not. The following are the most common issues Josephson Dunlap handles for hourly workers.
Straight Time for Overtime Hours
Some jobs pay the same hourly rate for all hours worked, including those past 40 in a workweek. Federal law says that you need to be paid more than your normal hourly rate if you work over 40 hours in one week. You should receive time-and-a-half. This means that you take your regular, hourly rate, and multiply it 1.5 times. Paying a flat rate for all hours, regardless of how many, could be a violation.
Off-the-Clock Work
Any time your employer requires or allows you to work without recording or paying for those hours, that is a violation. Pre-shift setup, post-shift cleanup, required training sessions, and responding to work messages outside of scheduled hours all count as work time and must be paid. The requirement does not need to be stated explicitly. If the employer knows or should know work is happening, those hours must be compensated.
Time Shaving
Some employers round down time records or edit timesheets to reduce the hours on record. A policy that always rounds in the employer's favor, or that rounds down in increments large enough to systematically reduce pay, may violate federal law. Even small amounts removed from each shift add up significantly over weeks and months of employment.
Bonus and Differential Exclusions
Non-discretionary bonuses, shift differentials, and certain other payments must be included in the regular rate before overtime is calculated. When an employer pays a bonus or differential during a week that also included overtime and does not adjust the overtime rate to account for it, every overtime hour in that pay period was underpaid. This is one of the least visible violations in hourly worker pay and one of the most common.
Misclassification as Exempt or Contractor
Some employers label hourly workers as independent contractors or as exempt salaried employees to avoid paying overtime. The label does not determine the legal outcome. The actual working relationship does. If your schedule, tasks, and tools are controlled by the employer, you may be entitled to overtime regardless of how the arrangement was described in any agreement.
Minimum Wage Violations
Federal law sets a minimum wage of $7.25 per hour, but most states have higher standards. If you earn tips, jobs are allowed to pay you less than the federal minimum but, it is their responsibility to ensure that tips plus the base wage together meet that minimum. If they do not, the employer is required to make up the difference. Paying below the applicable minimum wage for any hours worked is a separate violation from overtime underpayment.
What this means for you
Employers sometimes use procedures that appear routine, pre-approval requirements for overtime, rounding policies, automatic break deductions, or contractor agreements, to reduce what is recorded or paid without workers realizing anything is wrong. If any of these patterns describe your pay, a review of the specific facts can help determine whether a claim may exist.
Industries
Industries Where Hourly Worker Wage Claims Are Most Common
Overtime and wage violations affect hourly workers across nearly every sector of the economy. Josephson Dunlap has handled these cases for workers in all of the following industries and others.
- Retail and Grocery
- Food Service and Restaurants
- Manufacturing and Assembly
- Construction and Trades
- Healthcare and Home Health
- Logistics, Warehousing, and Delivery
- Hospitality and Hotels
- Mining and Energy
- Security and Protective Services
- Janitorial and Facilities Services
- Call Centers and Customer Service
- Agriculture and Food Processing
Frequently Asked Questions
Any hour worked past 40 in a single workweek must be paid at one and a half times your regular rate. The workweek is a fixed seven-day period set by your employer. Hours do not carry over between workweeks and the workweek cannot change from to week to week in order to avoid paying workers overtime.
No. Federal law requires time-and-a-half for hours past 40. Paying a flat rate for all hours, including overtime hours, is a violation. The difference between what you received and what you should have received may be recoverable.
No. Federal law prohibits employers from retaliating against workers who file wage claims or participate in related proceedings. If an employer retaliates, by cutting hours, changing your schedule, or terminating your employment, that is a separate violation with its own consequences.
Waivers of FLSA rights are generally not enforceable. You cannot legally sign away your right to overtime pay. Arbitration agreements may affect how a claim is filed, but they do not eliminate your right to recover unpaid wages. An attorney can review your specific agreement and explain your options.
The review is free. Josephson Dunlap doesn't ask anyone to pay out of pocket to find out if they could be owed for their overtime. Anything you discuss with our legal team is confidential, and there's no obligation to do anything.
It may. Certain bonuses must be factored into your regular rate before overtime is calculated. If your employer paid you a bonus during a week when you worked overtime but did not adjust your overtime rate, your overtime may have been underpaid for that period.
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If you have a valid claim, we get to work right away. Our team handles the paperwork, gathers the evidence, and builds a legal strategy suited to your situation.
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Once we have the facts, our legal team pursues the full amount you are owed. You receive updates throughout the process and pay nothing out of pocket. Attorney fees are collected only if we win.
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