By Brad Nakase, Attorney
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If the employer knows that the employee worked overtime, whether it was authorized overtime or unauthorized overtime, the employer has to pay for it. If, however, the employer truly has no knowledge of the overtime work, the employer will not have to pay for the unauthorized overtime. Unapproved extra hours can create big problems for your small business. Higher expenses, lower employee happiness and efficiency, and higher staff turnover are just a few ways extra work can cause trouble. Workers putting in unapproved overtime can lead to money issues, safety problems, and even legal challenges. Business owners often face stress trying to balance paying for extra work and keeping their teams happy. Here’s a detailed guide on what unapproved overtime means, the rules around it, and how to stop it effectively.
In the workplace, overtime is any time worked beyond a usual 40-hour week. For hours worked past 40, employees must be paid an overtime rate that’s at least one-and-a-half times their normal pay. For instance, if you usually pay someone $20 an hour, you need to pay them at least $30 an hour for overtime. Overtime pay ensures workers are fairly compensated for working more than the standard hours.
Unapproved overtime is any extra time that isn’t approved by management in advance. It can be obvious (like asking workers to stay late to finish an inventory job) or small overtime. Small overtime is more common. It happens when someone shows up a little early or clocks out 10 to 15 minutes late. This can also be called stealing time. While the time may seem small, over weeks or months, it adds up to big costs for employers.
Examples of unapproved overtime include working during an unpaid break, answering messages and reading emails after clocking out, or staying late after hours to finish a task. These actions might seem harmless to the worker, but they can disrupt the employer’s planning and budget.
Overtime rules exist to protect workers. Without these rules, employers might ask workers to put in long hours without fair pay. In the past, some businesses took advantage of workers, asking them to work many hours for very little money. Overtime laws ensure workers are treated fairly and paid for the extra time they spend at work. These laws also help employers create better schedules and keep their teams healthy and productive.
Overtime isn’t just about money—it’s also about fairness. Workers who put in more hours should be rewarded for their extra effort. These rules also prevent companies from overworking employees to save money.
Many employers simply do not allow unauthorized/unapproved overtime, and they outline this in the company handbook. When employees work unauthorized overtime, the company has to pay overtime wages, which can quickly add up. But that’s not the only concern. Overtime rules are made to protect workers, ensuring they get fair pay for extra hours. Federal overtime laws say overtime must be paid to workers who are not exempt and who work over 40 hours in one week. Both hourly and salaried employees can be non-exempt, as long as they:
There’s no set limit in the law on how many overtime hours someone can work in a week. Whether it’s 45, 60, or 80 hours, you still have to pay overtime. Also, working on weekends, holidays, or rest days doesn’t automatically mean overtime pay. But if overtime happens during one of these times, the worker is still entitled to it.
Employers are liable for paying unauthorized overtime, no matter the reason it was worked. Under California overtime law, the basic overtime laws say that a non-exempt worker who is 18 or older, or a 16- or 17-year-old who is not legally required to attend school and isn’t forbidden from the work, cannot work more than eight hours a day or 40 hours a week unless they are paid one-and-a-half times their usual pay for all hours over eight in a day and over 40 in a week.
An employer who requires or permits an employee to work overtime is generally required to pay the employee premium pay for such overtime work. Employees covered by the Fair Labor Standards Act (FLSA) must receive overtime pay for hours worked in excess of 40 in a workweek of at least one and one-half times their regular rates of pay.
California also has unique overtime rules that go beyond federal laws. For example, employees working more than 12 hours in a single day must be paid double their regular pay rate for those hours. These rules ensure workers in California receive extra pay for longer shifts.
Some jobs are more likely to involve overtime than others. Workers in healthcare, retail, manufacturing, and delivery often face overtime situations. For example:
Understanding how different industries handle overtime helps both employers and workers plan better schedules.
The answer is yes. According to California law, overtime must be paid regardless of whether an employee gets advanced authorization to work overtime. Employees are almost always legally owed overtime pay, even if it wasn’t approved. According to §785.11 of the Fair Labor Standards Act (FLSA) regulations, “Work not asked for but allowed is still work time.” Also, §785.13 says, “In all such cases, it is the management’s job to take control and stop the work if they don’t want it done.”
California Labor Commissioner’s advice also says that “an employee cannot purposely stop the employer from knowing about unapproved overtime work and then later demand pay. The employer must have the chance to follow the law.” However, if the employer knows (or should know) that the worker was working from home, they must pay for the overtime.
Unapproved overtime hurts employers in many ways. It takes up your time, costs you money, and lowers team morale—and that’s on a good day. Long periods of overtime work, especially without approval, can harm employees. They might feel worn out, leading to more stress. Over time, this can lower overall efficiency.
Safety problems can also happen. When workers take overtime without telling you, fewer safety measures are in place. If they’re tired or overworked and an accident happens, or someone’s safety is at risk, you could face serious issues.
Stopping unapproved overtime takes planning. With the right rules, clear communication, helpful tools, and steady follow-through, unapproved overtime can be avoided.
Employers should regularly review their overtime policies to make sure they follow the law. Training managers to spot and address overtime early can save time and money. For workers, asking questions about overtime policies can prevent misunderstandings. Both sides need to work together to avoid issues.
While employers must pay for unapproved overtime, they are allowed to discipline workers who break company rules. Employers who want to avoid paying for unapproved overtime can actively discourage extra hours by setting, sharing, and enforcing a clear rule.
For example, if an employer finds out a worker worked overtime without permission, they can and should discipline the worker, but they still must pay for the extra hours worked.
Unapproved overtime can strain both a company’s resources and its workers’ well-being. Every employer has a legal and moral duty to pay for all hours worked but can take steps to avoid unapproved overtime. With clear rules, regular communication, and modern tools, businesses can reduce the risks and costs of unapproved overtime while supporting a healthy and productive team.
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