On this page:
- What Counts Towards Overtime?
- How to Report Overtime
- Need Help With Time Reporting?
- Frequently Asked Questions
- Learn More
Non-exempt employees who are paid biweekly must be paid overtime compensation at one-and-one-half times their regular hourly rate of pay for all hours worked above 40 hours in a workweek. Overtime pay for non-exempt employees is required by U-M policy and by law under the Fair Labor Standards Act (FLSA).
What Counts Towards Overtime?
Only time worked is counted toward the 40 hours per week required for overtime pay. Exception time such as vacation, sick, PTO, holiday, military reserve duty, season days, educational time, funeral, extended sick, and time for jury duty does not count toward the 40 hours per week of time worked that is required for overtime pay. (Note: Staff represented by a collective bargaining unit should consult their agreements concerning overtime.)
How to Report Overtime
Non-exempt employees must report all hours worked in addition to exception time to the nearest one-tenth of an hour.
Use the code OTP (Overtime 1.5) to report time worked above 40 hours in one workweek, which are paid at one-and-one-half times your regular hourly rate of pay.
Use the code OTR (OverAppt Regular 1.0) to report time in excess of your normal scheduled hours when you did not actually work more than 40 hours in one workweek – for instance, if you used paid time off for part of the week, or your normal schedule is less than 40 hours and you remain below 40 even with additional work time. These hours will paid at your regular rate of pay.
Sample Time Reporting Scenarios With Overtime
Example 1 – Using OTP for Hours Worked Above 40 in One Week
An employee who typically works five eight-hour days stays an extra two hours one afternoon, for a total of 42 hours worked that week, including two hours of overtime paid at time-and-one-half.
| Mon | Tues | Wed | Thu | Fri | Total | Reporting Code | |
|---|---|---|---|---|---|---|---|
| Actual Hours | Worked 8 | Worked 10 | Worked 8 | Worked 8 | Worked 8 | 42 | |
| Time worked at regular rate of pay | 8 | 10 | 8 | 8 | 6 | 40 | REG (Regular) |
| Overtime at time-and-one-half | 0 | 0 | 0 | 0 | 2 | 2 | OTP (Overtime 1.5) |
Example 2 – Using OTR With Time Off
An employee who typically works five eight-hour days takes three days of vacation and then works one eight-hour day and one 12-hour day, for a total of 20 hours worked but 44 total hours reported that week. The employee does not get paid overtime because they did not work more than 40 hours.
| Mon | Tues | Wed | Thu | Fri | Total | Reporting Code | |
|---|---|---|---|---|---|---|---|
| Actual Hours | Vacation 8 | Vacation 8 | Vacation 8 | Worked 12 | Worked 8 | 44 | |
| Time worked at regular rate of pay | 0 | 0 | 0 | 12 | 4 | 16 | REG (Regular) |
| Time off at regular rate of pay | 8 | 8 | 8 | 0 | 0 | 24 | VAC (Vacation) |
| Over schedule at regular rate of pay | 0 | 0 | 0 | 0 | 4 | 4 | OTR (OverAppt Regular 1.0) |
Example 3 – Using OTR With Less Than 40-Hour Schedule
An employee who typically works three 12-hour shifts is called in for an extra three hours on another day, for a total of 39 hours worked that week. The employee does not get paid overtime because they did not work more than 40 hours.
| Mon | Tues | Wed | Thu | Fri | Total | Reporting Code | |
|---|---|---|---|---|---|---|---|
| Actual Hours | Worked 12 | Worked 12 | Worked 0 | Worked 12 | Worked 3 | 39 | |
| Time worked at regular rate of pay | 12 | 12 | 0 | 12 | 0 | 36 | REG (Regular) |
| Over schedule at regular rate of pay | 0 | 0 | 0 | 0 | 3 | 3 | OTR (OverAppt Regular 1.0) |
Example 4 – Using OTR With Less Than 40-Hour Schedule and Time Off
An employee who typically works three 12-hour shifts takes one PTO day, and then works two regular remaining shifts and picks up an extra eight-hour shift, for a total of 32 hours worked but 44 hours reported that week. The employee does not get paid overtime because they did not work more than 40 hours.
| Mon | Tues | Wed | Thu | Fri | Total | Reporting Code | |
|---|---|---|---|---|---|---|---|
| Actual Hours | Vacation 12 | Worked 12 | Worked 0 | Worked 12 | Worked 8 | 44 | |
| Time worked at regular rate of pay | 0 | 12 | 0 | 12 | 0 | 24 | REG (Regular) |
| Time off at regular rate of pay | 12 | 0 | 0 | 0 | 0 | 12 | PTS (Paid Time Off - Scheduled) |
| Over schedule at regular rate of pay | 0 | 0 | 0 | 0 | 8 | 8 | OTR (OverAppt Regular 1.0) |
Example 5 – Using OTP With Less Than 40-Hour Schedule
An employee who typically works three 12-hour shifts picks up an additional 12-hour shift later in the week, for a total of 48 hours worked. The employee gets paid overtime at time-and-one-half for 8 hours.
| Mon | Tues | Wed | Thu | Fri | Total | Reporting Code | |
|---|---|---|---|---|---|---|---|
| Actual Hours | Worked 12 | Worked 0 | Worked 12 | Worked 12 | Worked 12 | 48 | |
| Time worked at regular rate of pay | 12 | 0 | 12 | 12 | 0 | 36 | REG (Regular) |
| Over schedule at regular rate of pay | 0 | 0 | 0 | 0 | 4 | 4 | OTR (OverAppt Regular 1.0) |
| Overtime at time-and-one-half | 0 | 0 | 0 | 0 | 8 | 8 | OTP (Overtime 1.5) |
Need Help With Time Reporting?
For additional help with biweekly time reporting, go to My Linc and search using the keyword "time" for timekeeping training.
- View a list of all time reporting codes and their definitions on the Payroll website.
- Contact your department timekeeper or HR representative.
Frequently Asked Questions About Overtime Administration For Non-Exempt, Non-Bargained-For Staff
(Overtime administration for bargained-for staff is found within each of the union's respective contracts)
- Will an employee be paid for working more than 8 hours in one day?
- Pay for working more than 8 hours in a day will be at the employee's regular hourly rate until at least 40 hours of time worked have accumulated in that week.
- What if an employee works on a holiday?
- Hours actually worked on the holiday will count toward the 40-hour requirement for overtime pay. The employee will be paid according to the University Holiday.
- When do part-time employees receive overtime pay?
- Employees on a part-time appointment (fractional appointment) are paid at their regular hourly rate for each hour above their weekly appointed hours until they reach a total of 40 hours for the week. Hours beyond 40 per week are eligible for pay at time-and-one-half the regular rate.
- What if an employee works on their lunch break?
- Departmental lunch breaks, when unpaid, are at least 30 minutes (uninterrupted) and are scheduled by the department. During this time, the employee cannot be required to continue to perform job duties unless they're paid for the work time. When the lunch period is a paid portion of the regularly scheduled work day, it can't exceed 20 minutes. In these cases, employees are expected to eat lunch as time and work schedule permit.
- Does time spent answering emails or using a mobile phone for work outside of normal hours count towards overtime for non-exempt employees?
- For non-exempt employees who respond to emails or calls outside of normal work hours or while on lunch breaks on a “regular” basis, that time is counted as work time for overtime purposes. If the employee responds to emails or calls “very occasionally,” then court cases have considered that to be “de-minimis” and therefore not counted for overtime purposes. However, supervisors have discretion to establish overtime approval processes. If the employee continues to work overtime without supervisor approval, then the supervisor could begin taking possible disciplinary action with the employee.
- If an employee is called back to work, is that time included as time worked for the purposes of calculating overtime?
- If the employee actually works when being called back, yes. If the employee is sent back home without working, they will receive call back pay but those hours do not count toward the 40/week because they are not actually hours worked.
- Does an employee need to be paid overtime if the supervisor did not approve it?
- Yes. If non-exempt employees perform work, they must be paid for it. However, supervisors have discretion to establish overtime approval processes. If an employee continues to work overtime without supervisor approval, then the supervisor could begin taking possible disciplinary action with the employee.
- Can a supervisor request or require that a non-exempt employee work over 40 hours in a week?
- Yes. Supervisors are encouraged to give as much notice as possible to employees. Extra hours worked by a non-exempt employee must be paid at a straight or overtime rate according to SPG 201.38.
- Can a supervisor request or require that a non-exempt employee work over 40 hours in a week and offer compensatory (comp time) instead of overtime?
- No. A compensatory time arrangement occurs when an employee works more than 40 hours in one workweek, e.g. 46. Rather than be paid for the additional six hours at one and a half times the employee’s regular rate, 9 hours (one and one-half times the hours worked) is given off during some other workweek. This is not permissible. Non-exempt employees must be paid for overtime.
- Can a non-exempt employee waive overtime?
- No, employees don’t have the option of waiving the legal requirements.
- If evening work is required for a special need, can a non-exempt employee's daytime hours be reduced and replaced with evening hours?
- Yes, the schedule of an employee can be changed to meet the needs. This is called an “alternate” or “special” schedule. Advance notice should be provided to the employee. If an employee works an alternate or special schedule, and the total hours worked do not exceed 40 in a single workweek, no overtime is incurred.
- Can work schedules be changed by the unit?
- Yes. Although schedules should not change from day-to-day, work schedules can be changed to accommodate the needs of the unit and to avoid a special need for additional work hours and overtime compensation. According to SPG 201.67 regarding Work Schedules, regularly recurring consecutive hours of work should be provided whenever practical.
- Must overtime be paid if a non-exempt staff travel overnight on business outside of regular working hours?
- If an employee travels during regular working hours, yes, the regular pay continues. In other words, the employee should not suffer a loss of regular compensation. If the traveling occurs outside of normal working hours, there is no additional compensation unless there was work performed at the same time (i.e., working on a plane or train.) If work (or training) on the trip is over 40 hours, all of the additional time worked is paid as overtime. If travel is required on the weekend that is within normal daily work hours (typically 8 to 5 for most), it must be paid. (Note: The rules governing compensation while on overnight business travel for non-exempt employees are complex. Please speak with your HR representative for guidance based on specific circumstances.)
- What if an employee must work at an event outside of regular working hours (i.e., entertaining donors at an evening social function)?
- An employee working outside of regular working hours is still working. The time is considered time worked and counts toward the 40 hours per week requirement for overtime pay.