Employment Law

If an Employee Works Overtime, Can Comp Time Be Used Instead?

As most employees and business owners know well, the pay for overtime is time and a half. An employee who makes $20 per hour would need to be paid $30 per hour for every hour of overtime they worked. 

In some cases, this extra time is nearly unavoidable. Maybe an order has to be filled by the end of the day, for instance, or a job simply has to get done before the weekend. 

But that can make the finances harder to navigate for the employer, who didn’t account for the extra cost. If they want the employee to just take time off the following week, can they do that instead of paying them at the higher rate? 

Comp Time Can Be Used, but Not at The Standard Rate

Yes, an employer can offer the employee comp time to make up for overtime pay. This is legal. But the rate still has to be higher. The employee deserves time and a half either way for their extra efforts.

For instance, if an employee worked six extra hours one week, the employer could not tell them to come in for six fewer hours the following week. Doing so eliminates the advantage of working overtime, meaning the employee gets less compensation. The employer could offer them nine hours off the following week, however, giving them an hour and a half off for every extra hour they worked. 

Not all employers know this and employees may not either. That can lead to conflicts about wages and very complicated legal situations. Those who are involved must understand exactly what options they have moving forward.