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Must we pay for unapproved overtime?

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in Compensation and Benefits,Human Resources,Leaders & Managers,Management Training

Q. Our company requires employees to obtain their supervisors’ prior approval for all overtime. Our management takes the position that it does not need to pay overtime if employees don’t get approval first. My understanding is that all hours worked must be paid. Which is correct?

A. The federal Fair Labor Standards Act and the Illinois Minimum Wage Law require employers to pay overtime for more than 40 hours worked. The fact that your employees worked the hours without authorization is no defense to a wage-and-hour claim. You must pay employees for the actual hours they work.

(There may be a basis for you to dispute whether the employees, in fact, ever worked the overtime hours, but that is a question of fact that a court would have to sort out.)

Assuming that you have a clear policy requiring overtime preapproval, your only recourse is to discipline employees working unauthorized hours. 

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