Overtime Calculator for Tennessee

In Tennessee, overtime pay is governed by the federal Fair Labor Standards Act (FLSA), as the state does not have its own overtime laws. This means non-exempt employees must receive 1.5 times their regular pay for hours worked beyond 40 in a workweek. Importantly, Tennessee does not mandate daily overtime; the focus is solely on the weekly 40-hour threshold. For example, if an employee works 45 hours in a week, they are entitled to 5 hours of overtime pay.

Understanding exempt vs. non-exempt status is crucial. Non-exempt employees, often hourly workers, qualify for overtime. In contrast, exempt employees—such as executives or professionals—do not, provided they meet specific duties tests and salary thresholds. As of July 1, 2024, the minimum salary for exemption is $43,888 annually, rising to $58,240 in 2025. Employers should also include most bonuses and commissions in the regular rate when calculating overtime.

Accurate overtime calculation is essential for compliance and fair compensation. For hourly non-exempt employees, overtime is straightforward: work beyond 40 hours in a week is paid at 1.5 times the regular rate. For instance, with a federal minimum wage of $7.25, the minimum overtime rate in Tennessee would be $10.88 per hour.

Salaried non-exempt employees require a different approach. Their weekly salary is divided by 40 to find an equivalent hourly rate, and overtime is calculated at 1.5 times this rate. Additionally, non-discretionary bonuses and commissions must be factored into the regular pay rate. This ensures that overtime compensation reflects the true value of an employee's work.

Employers in Tennessee are legally permitted to require non-exempt employees to work overtime. However, they must comply with FLSA regulations, ensuring that overtime is compensated appropriately. Failure to do so can result in legal claims, as employees have up to two years to file for unpaid wages, extending to three years if the violation is deemed willful.

For employees, understanding your rights is vital. If you receive tips, your employer must ensure that tips plus the cash wage meet the $7.25 per hour minimum. Overtime calculations for tipped employees are based on this full minimum wage, not the reduced cash wage. Awareness of these rights can help protect against exploitation and ensure fair treatment in the workplace.

Common inquiries often revolve around Tennessee's adherence to federal overtime laws and how they affect different employment scenarios. For instance, many wonder whether daily overtime is required—Tennessee does not mandate it. Instead, overtime is calculated weekly.

Another frequent question involves salaried employees. Non-exempt salaried workers must have their salary converted to an hourly rate for overtime purposes. Additionally, bonuses and commissions are integral to this calculation, ensuring that overtime pay is comprehensive and fair. Keeping informed about these regulations helps both employers and employees maintain compliance and equity.