Overtime pay laws by state: The differences that matter

Federal overtime rules overview

Overtime regulations are established on a federal level by the Fair Labor Standards Act. Covered employees must receive overtime pay of at least 1.5 times their straight-time pay rate for hours worked over 40 in a given work week. The FLSA does not require overtime pay for work on weekends or holidays, unless this leads to overtime hours.

Exempt versus nonexempt employees

Some workers are exempt from federal overtime rules. Exempt employees typically receive a fixed salary, rather than hourly wages, and often work in executive, professional, or administrative roles. Your business does not have to pay an overtime rate for exempt team members.

Nonexempt employees, on the other hand, generally earn hourly pay and often work in manual or technical positions. Nonexempt workers must be paid an overtime premium.

Regular rate calculation

According to the FLSA, the regular rate calculation for your employees is their total weekly compensation divided by total hours worked. This sets their average hourly rate, which can then be used to determine overtime pay as needed.

States with daily overtime rules

Several states have daily overtime rules that go beyond federal rules. These include the following:

• Alaska: Overtime pay of 1.5 times the regular rate is required after eight hours in a workday, with some exceptions for small employers.
• California: Likewise, overtime pay of 1.5 times the regular rate is required after eight hours worked in a given workday. Double-time pay is required after 12 hours in a workday or eight hours worked on seven or more consecutive days.
• Colorado: You must pay workers time-and-a-half pay after they put in 12 hours in a workday and pay double time after they work 12 hours on a seventh consecutive day.
• Nevada: In the Silver State, employees who make less than 1.5 times the state’s minimum wage per hour are due overtime for hours worked above and beyond eight in a workday. If they earn more than that rate, they are simply paid standard overtime rates.
• New York: As of January 1, 2026, in New York State,  farm workers must be paid overtime after they reach 52 hours per week. The number of hours before getting overtime is set to decrease four hours every other year until it reaches a standard 40 hours per week in 2032.
• Oregon: In certain industries, such as packing plants and canneries, workers must be paid overtime if they work more than 10 hours in a workday.

States following FLSA only

Most states simply follow federal overtime laws as prescribed by the FLSA. These include the following:

• Alabama
• Arizona
• Arkansas
• Connecticut
• Delaware
• Florida
• Georgia
• Hawaii
• Idaho
• Indiana
• Iowa
• Kansas
• Kentucky
• Louisiana
• Maine
• Maryland
• Massachusetts
• Michigan
• Minnesota
• Mississippi
• Missouri
• Montana
• Nebraska
• New Hampshire
• New Jersey
• New Mexico
• North Carolina
• North Dakota
• Ohio
• Oklahoma
• Pennsylvania
• Rhode Island
• South Carolina
• South Dakota
• Tennessee
• Texas
• Utah
• Vermont
• Virginia
• Washington
• District of Columbia
• West Virginia
• Wisconsin
• Wyoming

Since overtime rules can evolve over time, to prevent issues and penalties, your business must stay up on the latest legislation.

Industry-specific overtime rules

While most industries follow federal overtime rules, there are some exceptions.

These can include:

• Agriculture: While the FLSA does not require overtime at 40 hours for ag workers, many states have instituted their own policies. In addition, farms annually using less than 500 “man-days” of labor are exempt from overtime laws
• Healthcare: Since healthcare workers often log longer shifts, overtime can be different in this industry. For instance, nursing care facilities may pay traditional overtime rates or use the eight and 80 system. This option pays overtime for any hours worked beyond eight hours in a day and 80 hours in a 14-day period
• Retail: In some cases, retail workers are also exempt from overtime rules. In this sector, workers must make 1.5 times the minimum wage for every hour worked, and more than half of their total earnings must consist of commissions

On a state-by-state basis, other regulated sectors may be exempt from federal overtime rules, although most fall in line with them.

Payroll system considerations

More automated payroll tools calculate overtime using hours worked, pay rate, and state-specific rules to support compliance.

Favor employees

As a rule, your business is required to pay whatever rate is more favorable to your workers. For example, if you have a business in California, you must pay double time if workers hit the 12-hour mark in a given day, even though this is not a federal rule.

Getting it right

If you do business in multiple states with varying overtime rules, you must accurately calculate payment following these state-by-state overtime rules. This includes accurate overtime for multiple pay types and shifts. Again, automated payroll software can make this process a breeze for your payroll team.

Applying state versus federal rules

While most states defer to the federal Fair Labor Standards Act, if any state where you do business has more stringent policies, you must follow them. However, if your business is in Minnesota, the only state to have a 48-hour-per-week overtime law, you still must follow the 40-hour federal rule for overtime pay. The Minnesota law applies only to employees who are not covered by the FLSA.

Tracking hours and pay rates

On its own, tracking regular hours and pay rates in multiple states can be challenging. When you add in overtime hours and different rules, it gets a lot more complicated. Third-party tools can streamline and organize this process to prevent errors, save time, and deliver on compliance.

Common exemptions and compliance pitfalls

Common exemptions to overtime laws include professionals who are paid a salary rather than an hourly rate. Some industries such as agriculture are also allowed to require more hours before overtime kicks in.

Compliance pitfalls can include the following:

• Misclassifying employees: Don’t assume that certain job titles mean an employee is exempt or nonexempt. Make sure every employee is correctly classified before they start work to calculate accurate payment
• Overlooking state laws: When state laws offer more favorable pay to employees, your business must follow them. Stay aware of ongoing updates related to overtime pay
• Poor recordkeeping: Your business must maintain complete and accurate records that detail overtime work. Regular audits can also support better recordkeeping
• Lack of communication: Finally, it’s important to communicate with your leadership team and team members so they understand overtime rules and pay. Employees should also understand applicable no tax on overtime and travel time pay rules

Overtime laws can change over time. Stay in tune with your state’s legislation to support better compliance.

State and DC overtime comparison table

The following table shows overtime regulations by state.

If any changes are announced during the year, we’ll keep this resource up to date. That said, it’s always a good idea to check any local or state resources where you to business.