Extra pay is often the reward for working the dreaded second and third shifts at hospitals, factories and elsewhere. Hourly employees don't have a contract and are only paid for hours worked. (Obviously I don't want it to be!) This salary is divided between the pay periods (as determined by the company) for the year and based on a 2080-hour year. "Fact Sheet #21: Recordkeeping Requirements under the Fair Labor Standards Act (FLSA)." There are some employers who use the word "salary" to avoid paying overtime to workers who are actually hourly employees. If you were hired on salary, you should be paid the same for your work regardless of when or on what shift it is performed. Employees will be classified as either exempt or non-exempt, based on the duties and responsibilities of the positions. New Jersey does not require employers to provide breaks, including … Equivalent pay includes the same or equivalent pay premiums, such as a shift differential, and the same opportunity for overtime as the job held prior to FMLA leave. What should I do? Fact Sheet #70: Frequently Asked Questions Regarding Furloughs and Other Reductions in Pay and Hours Worked Issues. What's the Difference Between Full-time and Part-time Employees? State laws also regulate when overtime may be paid and the rate of pay. You must pay overtime after 40 hours of actual work in a 7-day workweek, with the exception of certain salaried employees who meet the definition of an executive, administrative or professional. Definitions: I. only report 3 shift hours using Example 1 mentioned above or only report 6 shift hours using Example 2), Erratic Trump has military brass highly concerned, 'Incitement of violence': Trump is kicked off Twitter, Some Senate Republicans are open to impeachment, 'Xena' actress slams co-star over conspiracy theory, Fired employee accuses star MLB pitchers of cheating, Unusually high amount of cash floating around, Flight attendants: Pro-Trump mob was 'dangerous', These are the rioters who stormed the nation's Capitol, 'Angry' Pence navigates fallout from rift with Trump, Late singer's rep 'appalled' over use of song at rally. A salaried employee is classified as exempt from the Fair Labor Standards Act (FLSA) under one of four main categories according to the government. The law does not require you to offer additional compensation, but it can help retain employees. Wage and Hour Division. (letter). The employer decides a shift differential rate and can negotiate this amount with an employee. What Determines if an Employee is Salaried or Hourly, When You Must Pay Overtime for Exempt Employees, How to Calculate Pay for Salaried and Hourly Employees, What If You Don't Pay Salaried and Hourly Employees Correctly, A Final Word on Salaried and Hourly Employees. Are my paychecks going to be adjusted for the first 2 weeks? For calculation purposes, a salaried employee is determined to work 2080 hours a year (52 weeks times 40 hours a week). Example: An hourly employee is paid $9.62 an hour. What kinds of careers do not involve math? Making sure their job description fits the other definitions for being exempt. Employees are categorized both on the type of work they do and the ways in which they get paid. Most businesses will outline how shift differentials work, if they’re offered, in the employee handbook.Usually, however, differential Shift differential refers to extra pay received by employees for working a less-than desirable shift (i.e., late nights, evenings). An employer must pay its employees at least the minimum wage for all hours worked, and time and one-half overtime pay based on an employee's regular rate of pay for all hours worked in excess of 40 in a workweek unless the employee is exempt for some reason. "Fact Sheet #70: Frequently Asked Questions Regarding Furloughs and Other Reductions in Pay and Hours Worked Issues." If alternative notification options are available for emergency situations, those options should be communicated to all employees in the department. Learn About the Process and Tips for Calculating Net Pay for Employees, Want to Do Your Own Payroll Processing? Both federal and state laws set these requirements, including, for example, minimum wage rates. You should receive the same pay as you would working during the day as you would working the overnight shift. Since the employee worked at least 4 hours during shift time, the shift differential will be paid for the employee’s entire 6-hour shift. Employees are designated as exempt on a case-by-case basis, based on their job description. U. S. Department of Labor. However, the FLSA does require that covered, nonexempt workers be paid not less than time and one-half the employee's regular rate for time worked over 40 hours in a workweek. I was offered a base salary plus 10% shift differential. Accessed Nov. 11, 2019. An hourly employee is paid based on an hourly amount. Currently the minimum wage in North Carolina is $7.25 an hour. Do you understand the difference? An employer is always allowed to pay overtime more generously to hourly employees than required by law. Every state has minimum wage laws and overtime laws that may be higher or lower than federal requirements. #11. I really want this job however the company itself seems really screwed up! Wouldn't that be hard since it's salary and not hourly? Being paid a salary usually, but not always, means an employee is "exempt." Paying them at least the minimum requirement (detailed above), and. My company has a shift differential policy that states "exempt employees receive 10% of their salary if they start their regular shift after 9:59 am. If the employee is ready, willing and able to work, their pay can't be reduced for times when work isn't available. If salaried employees are paid monthly, this employee would receive $1666.67 a month ($20,000 divided by 12). This is usually done by paying the employee in question an additional percentage of their base salary. For example, guards who work the second shift still earn $15 per hour, leaving them with $120 in gross pay ($15 x 8 hours). Yes. I was offered a base salary plus 10% shift differential. 12-hour 7a/7p employees receive shift diff for time worked 3PM to 7 PM etc. The opportunity to take on a shift with differential pay means staff have options if they have an unexpected expense or need to take time off and make some extra cash to cover it. She has written for The Balance on U.S. business law and taxes since 2008. Massachusetts Shift Differential and Shift Premium Laws Employment Attorney representing employees in unpaid wage and unpaid overtime claims related to shift differentials and shift premiums across Massachusetts including in Worcester, Lowell, Springfield, Fall River, Pittsfield, and Barnstable That you were offered a base "salary" plus a shift differential actually means you are an hourly employee. So, in the examples above, the $9.62 an hour paid to the hourly worker is roughly the same as the $20,000 annual salary paid to the salaried worker.. A salaried employee is paid based on an annual amount, called a salary. Salaried employees have a set minimum annual level of compensation. My shift starts at 1pm. Accessed Nov. 11, 2019. My first 2 weeks on the job are going to be during the day since I am training. Next, multiply the night shift hours by the night shift differential to find the total night shift pay: 16 hours x $5/hr = $80 FInally, add the night differential to his base pay for the total pay: The distinction between salaried and hourly employees is based on the type of work done by these employees and their status as being exempt or not exempt from overtime. Example: An hourly employee is paid $9.62 an hour. Across all industries, approximately 25% of companies pay premiums to salaried employees for shifts worked that are not regular weekday shifts. Then overnight after. How to Calculate Overtime Pay for Hourly and Salaried Employees, How to Calculate Paycheck Withholding and Deductions. NJSA 34:2-21.17d(g)(4). The payment of a shift differential is appropriate when overtime-eligible, non-bargaining unit employees, and occasionally, exempt employees by prior agreement and because of their job description, are regularly scheduled to work an evening, night or weekend shift. What is the Difference Between Salaried and Hourly Employees? You may need to pay overtime to some salaried employees if their pay falls below a federal minimum amount. Are my paychecks going to be adjusted for the first 2 weeks? If salaried employees are paid monthly, this employee would receive $1666.67 a month ($20,000 divided by 12). The U.S. Department of Labor says that anyone paid a salary must meet the "salary basis" test which states that someone who has a predetermined amount of compensation each pay period that can't have their pay reduced because of variations in the quality or quantity of the employee's work. . My new job is an overnight position. How to calculate retro pay for hourly and salaried employees This applies to salaried employees as well as those who are paid by the hour. Amounts typically range between 5 and 15 percent of base salary. I think you need to clear this up with your employer. Example: A salaried employee is paid $20,000 a year. In the US, unless you're part of a union and/or the shift differential is part of an employment contract, then there is nothing at all wrong with an employer ceasing to pay such differential, even if it's paid for some people but not for others. (Obviously I don't want it to be!) There is a difference between a base wage and salary. "Final Rule: Overtime Update." With the shift differential, she earns $22.50 per hour ($15 standard wage rate x 1.5 shift differential rate). Just to be clear, if you pay a salaried employee less than $684 a week or $34,468 a year, this person must receive overtime pay at the federal minimum rate of 1 1/2 times the hourly rate for all hours worked more than 40 in a workweek. This does not vary from state to state, it is a federal law, and if it turns out that you are actually an hourly employee and they have failed to meet the requirements associated with that (regular paid breaks, overtime pay for over 8 hours a day, and over 40 hours per week), they can be sued for three times the amount you were not paid. "Wage and Hour Division. Yes, they can pay you a higher salary for working a not so desirable shift, but they can't say you will receive a shift differential if you are not an hourly employee. My first 2 weeks on the job are going to be during the day since I am training. The employer can't have it both ways. Will I have to pay overtime? 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