Overtime Pay for Federal Government Employees
The federal government must pay most employees overtime as required by the Fair Labor Standards Act (FLSA). Overtime pay for federal government employees are determined by special rules and regulations that are often particularly complex. Some federal employees who are not entitled to overtime pay under the FLSA still may be entitled to overtime pay under Title 5. Some forms of government pay, such as LEAP and hazard pay, are available under Title 5, but not the FLSA. Some commonly occurring problems with overtime pay and government workers are identified below.
Federal Agencies Often Misapply Overtime Rules For-Federal Employees
Federal agencies often incorrectly and illegally misclassify federal employees as exempt from overtime pay. Some of the ways that federal employees are often misclassified include the following.
Incorrect Calculation of the of the Regular Rate for Overtime Pay Calculation Purposes
Like private sector employees, persons who are employed by the federal government and government agencies are entitled to receive overtime pay at one and one-half times their regular rate of pay when they work more than 40 hours per week. The “regular rate” is a legal term. The term “regular rate” is the hourly rate of pay from which overtime pay is calculated. One difference is that in federal employment, paid leave hours are counted as hours of work. In addition, in determining a federal employee’s regular rate of pay for purposes of calculating the overtime rate of pay, the agency must generally include all additional and/or premium pay, non-discretionary or regular bonuses as part of the hourly rate of pay. In addition, for many federal employees, overtime pay is calculated for time worked in excess of 8 hours per day, instead of in excess of 40 hours per week.
For employees working in federal employment, the regular rate is calculated by performing the following steps:
- the employee’s annual GS salary is first divided by 2087, the number of regular work hours in a year.
- this amount is then multiplied by 40 to yield a weekly amount.
- any Title 5 premium pay earned in the work week, such as night shift differentials, Sunday premium pay, and hazardous duty pay, is then added to the weekly amount.
- this amount is then divided by 40 hours to obtain the regular rate of pay.
- federal employees are entitled to receive 1.5 times the regular rate of pay for each overtime hour worked that week.
Different rules apply to employees who receive administratively uncontrollable overtime. Different overtime rules also apply to law enforcement and fire protection employees, which are discussed here.
Incorrect Blanket Use of Exemptions and Grade Cutoffs
Many federal agencies automatically consider all employees who are employed at certain job grade to be exempt from the overtime pay provisions of the FLSA. This is the most frequent and common violation of the FLSA that federal agencies make in illegally denying employees their earned overtime pay. For example, many agencies automatically exempt employees who work at the GS-11 and GS-12 grade level and above from the right to receive overtime pay.
The FLSA and federal law requires every employer, including the federal government and federal agency employers to examine the actual job duties that are performed by an employee before exempting or excluding them from the right to overtime pay.
Law Enforcement Availability Pay
Law Enforcement Availability Pay (LEAP) is a special exemption to the FLSA for federal criminal investigators. To qualify for LEAP pay, an employee must work and be correctly be classified as a criminal investigator in the GS-1811, GS-1812 or FP-2501 grade. Employees who receive LEAP pay must perform unscheduled overtime work an average of two hours a day or be available to perform unscheduled overtime work.
Federal employees who are entitled to receive LEAP pay are also entitled to Title 5 overtime compensation. That means that LEAP pay must be paid in addition to LEAP pay if the federal employee works outside their regular workday or if he works regularly scheduled overtime. The LEAP pay statute, however, does not provide for regularly scheduled overtime unless the investigator works on a day outside of the investigator’s basic 40 hour work week or the investigator works more than 10 hours on one of the investigator’s regularly scheduled workday.
Work Outside of the United States
The FLSA generally does not apply to private sector work that is performed outside of the United States. The federal government, however, has implemented different rules to determine whether the FLSA applies to work that federal government employee perform outside of the United States or in a foreign country. Under the rules of the Office of Personnel Management (OPM), an employee who performs any work in the United States during the workweek is entitled to protection and coverage under the overtime laws. That means that if an employee has performed any work in the United States, then all the work that is performed in that week must be paid as required by the FLSA and the employee is entitled to overtime pay.
Overtime Pay Law and Rules Under Title 5
Most GS employees who are not entitled to overtime pay under the FLSA still must be paid overtime pay under Title 5. The method of calculating the regular rate of pay under Title 5 is different than calculating the overtime rate of pay under the FLSA. Under Title 5, the regular rate of pay for overtime pay purposes is calculated as follows:
- an employee’s annual general schedule salary is divided by 2087, which is the number of hours of work the annual salary is meant to compensate the employee;
- The employee is then entitled to receive one and one-half times that rate of pay or for employees who are paid at a rate higher than the rate of a GS-10, step one, exempt employees are paid at that rate or the employee’s straight time rate, whichever rate is higher.
The maximum rate at which Title 5 overtime can be paid to most FLSA exempt employees is, therefore, the GS-10, step one rate or their straight time rate.
Other Overtime Issues Under Title 5
Some examples of the differences between the FLSA rules for the payment of overtime pay and the Title 5 rules for the payment of overtime to federal employees are the following.
AUO or Administratively Uncontrollable Overtime
Federal agency employees, like federal air marshals, who work a large amount of irregular or uncontrollable overtime that cannot be scheduled in advance may be paid an additional percentage of their salaries as administratively uncontrollable overtime (AUO). The correct percentage on top of the salary amount may vary between 10% and 25% depending on the amount of irregular hours actually worked. AUO must be paid by the federal agency regardless of the number of hours that the employee works in a workweek of pay period. In order to qualify for AUO pay, however, the employee must work a certain number of hours over a three-month period.
Federal agencies are not required to pay AUO compensation to employees. Instead, it is permissible to pay Title 5 overtime pay at the employee’s overtime rate of pay or the rate for a GS-10, step one, whichever is lower.
Standby pay, like AUO, is a percentage of the employee’s basic pay up to a maximum of 25%. Standby pay is paid instead of other forms of premium pay available under Title 5, except for irregular overtime in excess of the employee’s regular tour of duty. Agencies may elect to pay standby pay to federal employees who are regularly required to remain at their station during longer than ordinary periods of duty, and a substantial part of the duty time is spent on-call rather than performing work.
Sunday Premium Pay
Federal agencies may be obligated to pay Sunday premium pay to employees whose regular hours of work include work time on a Sunday. If any part of the employee’s 8-hour shift falls on a Sunday, the employee is entitled to additional pay equal to 25% of the employee’s pay for that shift.
Night Shift Differential
Federal agencies may be obligated to pay a night shift differential to employees whose regularly-scheduled hours or work are between the hours of 6:00 p.m. and 6:00 a.m. The differential must equal ten percent (10%) of an employee’s basic pay for the shift. The night shift differential must be paid to federal employees if they work any part of their 8-hour shift between 6 p.m. and 6 a.m.
Federal employees who work on a recognized holiday—a holiday that is established by statute or Executive Order—must be paid double pay for the first 8 hours they work on the holiday. Thereafter, the same rules for Title 5 overtime pay that apply to overtime work on a regular workday apply to overtime work on a holiday. An employee who is required to perform any work on a holiday is entitled to pay for at least 2 hours of holiday work. Holiday pay is also in addition to Sunday premium pay and night-shift differential.
Hazardous Duty Pay
Federal employees must be paid additional compensation if they are exposed to hazards or unusual physical hardship. The OPM has defined hazardous duty as work which could result in serious injury or death. This can include exposure to toxic chemicals, certain biological elements, incendiary materials, underwater duty, or exposure to extreme heat.
If a federal employee is engaged in or is performing hazardous duty, the employee must be paid additional compensation of between 10% and 25% of his basic pay for that day. The amounts are determined by OPM. One exception to hazardous duty pay, however, is if the agency has already taken into account the hazardous duty in classifying the employee’s position.
Title 5 And The FLSA Have Different Limitations Periods
The statute of limitations in Title 5 cases is six (6) years. The statute of limitations in FLSA cases is only two years, which may be extended to three years in cases where the employer willfully violated the FLSA. This difference in the limitations period means that substantial amounts of overtime may be recovered under Title 5, in addition to the overtime pay that is owed under the FLSA.