Overtime Rules

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How is overtime calculated?
Purpose: Master the complexities of overtime calculations with this comprehensive guide, empowering you to ensure accurate employee payments by understanding U.S. and Canadian overtime rules and regulations.
Table of Contents
- Standard U.S. & Canada Rules
- Custom Rules
- Work week
- Locations of employees for overtime calculation
- Exempt employees
- Salary, non-exempt (BambooHR Payroll customers)
- Overtime rules for specific states
- Overtime rules for specific Canadian provinces
- Overtime on the employee profile
- Overtime view for approvers
Standard U.S. & Canada Rules

Standard rules automatically calculate overtime based on U.S. State and Federal overtime regulations, and Canadian Province overtime regulations. An employee's location (found in the Job Information table on the Job tab) determines which rules apply.
Custom Rules

If your employees work outside of the U.S. and Canada or follow an alternate work schedule, input your company's specific overtime rules. Time Tracking applies these rules to all employees in the time tracking group, overriding standard rules.
- Daily Overtime - 1.5x the rate of pay for any hours worked over [x] hours in a day
- Daily Double Overtime - 2x the rate of pay for any hours worked over [x] hours in a day
- Weekly Overtime - 1.5x the rate of pay for any hours worked over [x] hours in a week
Changes made to overtime calculations update immediately and apply retroactively to the beginning of the current pay period.
If an Account Owner or Full Admin user edits an approved or past unapproved timesheet, the system recalculates overtime based on current overtime settings.
If daily overtime hours (all hours paid at 1.5x and 2x regular rate) equal or exceed weekly overtime hours, employers must compensate the employee according to the daily overtime rules for that week. (Weekly overtime hours are already accounted for and paid.)
If weekly overtime hours exceed total daily overtime hours (all 1.5x and 2x regular rate) for that workweek, the employer must pay all weekly overtime hours in addition to daily overtime. Employers must identify and pay any double-time hours required under daily overtime rules.
Work week
To calculate overtime, we must know the date and time when the workweek starts and ends. In the United States, the most common workweek begins on Sundays at 12:00 AM, but can be any consecutive 168 hours.

When setting up BambooHR Time Tracking, determine the workweek's start day. The default is set to Sunday.
If you edit the workweek's start date after enabling Time Tracking, a note indicates this change takes effect at the start of the next pay period. The next timesheet will show some days where the system cannot calculate overtime. Full Admin users must manually add overtime during the transition pay period.
Location
To determine the correct state, U.S. Territory, or Canadian province for an employee's overtime calculation, check their location in the Job Information table. If an employee's location includes a U.S. state, U.S. Territory, or Canadian province, the system can calculate their overtime.
If you select the standard overtime rules option and the business location is outside the United States or Canada, or if the address does not list a U.S. state, U.S. Territory, or Canadian province, the system cannot calculate overtime for employees at that location.
Do you need help adding addresses to your locations? Learn how to do this here.
Personal addresses
If an employee works at a remote location (determined in the location setup in Settings), the system uses their personal address to calculate overtime. If their personal address shows a U.S. state or territory, the system uses that state or territory's laws to calculate overtime.
If their personal address is outside the United States or does not list a state or territory, the system cannot calculate overtime for the employee.
Employees with no state or province location to calculate overtime
The Location column in Time Tracking settings indicates employees without an assigned U.S. state or Canadian province.

You can still enable the employee, but the system will not calculate overtime until you add them to a location with a listed state or province.

To trigger overtime recalculations for an employee whose status changes from exempt to non-exempt (including when an employee has a U.S. state listed), manually add or edit hours on their timesheet. Open the edit option for an entry and select Save. This action recalculates that entry along with any other entries for the specific pay period.
If you select the Custom Overtime Rules option, the Location column lists the title of the location the employee is assigned to in their Job Information table. The Overtime State column shows "Custom" for all non-exempt employees. Exempt employees shows as "Exempt".

If an employee's overtime status is "Exempt" in the Compensation table, BambooHR does not calculate overtime for the employee.
Overtime does not automatically calculate if an employee changes from exempt to non-exempt status. Open the time entry modal and select Save to update the entry. Re-saving an entry recalculates the entire pay period, eliminating extra manual work.

BambooHR Payroll customers will see the two fields combined within the Compensation table for salary and non-exempt employees. This populates a new field that identifies the overtime rate for payroll syncing.
Additionally, the system automatically calculates a "double time rate" based on the amount entered in the Overtime Rate field. The "double time rate" is for informational purposes only and is viewable when editing an employee's compensation information.

FLSA requires payment of time and a half (1.5x) for any hours worked over 40 in a single workweek. For states not listed below, the default calculation is 1.5x. BambooHR has programmed different overtime rules for the following states.
Alaska
- Overtime hours apply to any time worked after 8 hours in a single workday or 40 hours in a week.
- If a shift spans midnight in the employee's timezone, overtime stops at midnight, and hours restart for the new day.
California
- Overtime hours include any time after eight hours in a single day, 40 hours in a week, or the first eight hours on the seventh consecutive workday in a workweek. All of these pay at 1.5x the hourly rate.
- A 2x pay rate applies after 12 hours in a single day or eight hours on the seventh consecutive day.
Overtime hours breakdowns (1.5x vs. 2x) appear only when a comparison is necessary. It does not show if the employee was only eligible for the 1.5x hourly rate. This breakdown of overtime hours appears in the following places in BambooHR when applicable:
- Employee's view: Timesheet and timesheet summary.
- Approver's view: Approval notification in BambooHR, approval email notification, and timesheet details.
- Admin's view: Payroll Hours report (1.5x and 2x differentiates in the same column), Payroll Hours report export (each rate shows in a separate column), Payroll Hours Detail report export (each rate shows in a separate column).
BambooHR Time Tracking calculates overtime based on a 12:00 AM to 11:59 PM workday. If your company operates an overnight shift and an employee works overtime past midnight (e.g., 5:00 PM to 2:00 AM for a total of 9 hours), the calculation no longer factors overtime for a shift longer than 8 hours because the timesheet resets at midnight.
Colorado
- Overtime hours apply for any time worked after 12 hours in a day or 40 hours in a week.
- Overtime hours apply for any time worked after 12 consecutive hours, regardless of the starting and ending time of the workday (the hours will be considered overtime if the work begins on a Monday and finishes on a Tuesday).
BambooHR Time Tracking calculates overtime based on a 12:00 AM to 11:59 PM workday. If your company operates an overnight shift and an employee works overtime past midnight (e.g., 5:00 PM to 2:00 AM for a total of 9 hours), the calculation no longer factors overtime for a shift longer than 12 hours because the timesheet resets at midnight.
Kentucky
- Overtime hours apply to any time worked after 40 hours in a week.
- Overtime hours apply to any time worked on the seventh consecutive day in a workweek.
- Workweeks have only seven days, making this applicable for a single day.
- Hours worked on the previous six days count that day as a day worked.
- Overtime ends at midnight on the seventh day.
Puerto Rico
- Overtime hours apply to any time worked after 8 hours in a day or 40 hours in a week.
- Overtime hours will apply to any time worked on the seventh consecutive day in a workweek.
U.S. Virgin Islands
- Overtime hours apply to any time worked after 8 hours in a day or 40 hours in a week.
- Overtime hours apply to any time worked on the sixth and/or seventh consecutive day in a workweek.
Alberta
Overtime hours apply to any time worked after 8 hours in a day or 44 hours in a week.
British Columbia
- Overtime hours apply to any time worked after 8 hours in a day or 40 hours in a week.
- Overtime pay will be double (2x) for any time after 12 hours in a day.
Manitoba
Overtime hours apply to any time worked after 8 hours in a day or 40 hours in a week.
New Brunswick
Overtime hours apply to any time worked after 44 hours in a week.
Newfoundland and Labrador
Overtime hours apply to any time worked after 40 hours in a week.
Nova Scotia
Overtime hours apply to any time worked after 48 hours in a week.
Ontario
Overtime hours apply to any time worked after 44 hours in a week.
Prince Edward Island
Overtime hours apply to any time worked after 48 hours in a week.
Quebec
Overtime hours apply to any time worked after 40 hours in a week.
Saskatchewan
Overtime hours apply to any time worked after 8 hours in a day or 40 hours in a week.
Yukon
Overtime hours apply to any time worked after 8 hours in a day or 40 hours in a week.
Northwest Territories
Overtime hours apply to any time worked after 8 hours in a day or 40 hours in a week.
Nunavut
Overtime hours apply to any time worked after 8 hours in a day or 40 hours in a week.
Overtime information appears on an employee's Timesheet tab in the following places:
- Daily graph: If overtime is added to a specific day within a time frame, the day appeas as an orange bar on the graph.
- Overtime total: The time summary shows the total overtime for the pay period.
- Daily view: The timesheet shows the total amount of overtime for a specific day.
Paid time off does not apply to overtime. For example, if an employee works 38 hours and have four hours of paid time off, they still only worked 38 hours and do not receive overtime for exceeding 40 hours in the workweek.
Email notification

When an approver receives an email notification to review timesheets, the email displays the total hours for each employee with a link to their timesheet. If an employee has overtime hours, the email notification shows them.
An employee's timesheet
When approving on the Timesheet tab, overtime hours appear in the specific timesheet summary.