What do federal labor laws require when you schedule and pay?
Under the Fair Labor Standards Act, covered, nonexempt employees are entitled to at least $7.25 an hour, effective July 24, 200967. Overtime is at least 1.5 times the regular rate for hours over 40 in a workweek24.
The FLSA does not limit the hours in a day or the days in a week for employees 16 and older8. It does not require meal or rest periods, but it does require break time to express breast milk910.
Where an employee is subject to both a state and the federal minimum wage, the employee is entitled to the higher of the two11. Many states and cities add their own rules; the table below gives some for nine of them.
This text does not constitute legal advice. Obligations vary by establishment and change over time. Confirm yours with the U.S. Department of Labor, the labor department of your state and city, or a qualified advisor.
What do these states add to the federal rules?
The FLSA does not excuse noncompliance with a state or city law that sets a higher minimum wage or a lower overtime threshold, in the statute's words a “maximum workweek lower” than its own12. The Department of Labor keeps a table of every state's minimum wage and premium-pay hours13.
| State | What it adds to the schedule |
|---|---|
| California | Overtime after 8 hours in a workday and double time after 1214. |
| New York | 24 consecutive hours of rest in any calendar week for employees of factories, stores, hotels and restaurants, and for watchmen in dwellings, apartment, loft and office buildings, garages and storage places, with the exceptions § 161(2) lists151617; in New York City, overtime after an 8 hour day for covered security guards from January 1, 2027, later under some existing agreements18192021. |
| Oregon | Written schedules at least 14 calendar days ahead, for employees whose work is retail, hospitality or food service, at employers with 500 or more such employees worldwide2223. |
| Washington | A meal period of at least 30 minutes starting no sooner than 2 hours and no later than 5 hours after the shift begins, and a paid rest period of at least 10 minutes for each 4 hours2425. In Seattle, schedules posted 14 days ahead for hourly employees at retail and food service establishments with 500 or more employees worldwide; full service restaurants also need 40 or more full-service locations2627. |
| Illinois | 24 consecutive hours of rest in every consecutive seven-day period, with watchmen and security guards among the exemptions the statute lists282930. A meal period of at least 20 minutes, starting no later than 5 hours in, on a shift of 7 1/2 continuous hours, unless a collective bargaining agreement sets meal periods3132. In Chicago, 1 hour of predictability pay for a shift change within 14 days, for employees in seven industries, building services among them, who earn up to $33.85 an hour or $64,945.55 a year, at employers with 100 or more employees globally (250 and 30 locations for restaurants)3334. |
| Pennsylvania | In Philadelphia, schedules 14 days ahead at retail, food and hospitality establishments with 250 or more employees and 30 or more locations worldwide353637. |
| Alaska | Overtime after 8 hours a day as well as after 40 a week, except at employers with fewer than four employees, among the exceptions the statute lists38. |
| Nevada | Overtime after 8 hours in a 24-hour period for employees who earn less than $18.00 an hour, unless otherwise exempted3940. |
| Colorado | Overtime after 12 hours in a workday or 12 consecutive hours, as well as after 40 a week, except as the order's exemptions provide41. |
What changes in the week under federal law?
When you build the schedule
The FLSA counts overtime by the workweek: hours over 40 are paid at not less than 1.5 times the regular rate2. It does not limit the hours in a day or the days in a week for employees 16 and older8.
Hospitals and residential care establishments may, by an agreement made before the work, use a 14-day period instead of the workweek4243. Overtime then starts after 8 hours in a workday and after 80 hours in the period42.
When people take breaks
The FLSA does not require meal or rest periods9. Rest periods running from 5 minutes to about 20 minutes that an employer allows must be counted as hours worked4445.
The FLSA requires one kind of break: reasonable break time each time an employee needs to express breast milk, for 1 year after the child's birth, and a place other than a bathroom, shielded from view and free from intrusion10. An employer of fewer than 50 employees is exempt where the requirements would impose an undue hardship10.
A bona fide meal period is not worktime when the employee is completely relieved from duty, and ordinarily 30 minutes or more is long enough46.
In payroll
The federal minimum wage is $7.25 an hour1. Where an employee is subject to both a state and the federal minimum wage, the employee is entitled to the higher of the two11.
Under the FLSA, with a tip credit, the employer pays at least $2.13 an hour in direct wages, and makes up the difference when tips and direct wages fall short of the minimum wage47. Some states require employers to pay tipped employees the full state minimum wage before tips, among them Alaska, California, Nevada, Oregon and Washington48.
When someone takes time off
The FLSA does not require vacation, holiday, severance or sick pay9. On covered federal contracts, Executive Order 13706 adds paid sick leave49.
The Family and Medical Leave Act gives eligible employees unpaid, job-protected leave for qualifying family and medical reasons50: up to 12 workweeks in a 12-month period51, or up to 26 workweeks in a single 12-month period for a spouse, child, parent or next of kin caring for a covered servicemember52. It covers private employers with 50 or more employees in 20 or more workweeks in the current or previous calendar year and, of any size, public agencies and public and private elementary and secondary schools5354.
What changes on federal contracts, for guards and others?
The Service Contract Act applies to federal contracts over $2,500 whose principal purpose is furnishing services through service employees55. Each contract specifies a wage determination: the minimum wage and fringe benefits for each class of service employee, set by the Secretary of Labor from prevailing rates in the locality, or from a collective bargaining agreement that covers the employees56.
Guard and watchman security service is among the services found to be covered57.
The Contract Work Hours and Safety Standards Act applies to contracts over $100,000 and to laborers and mechanics, watchmen and guards included58. It requires at least 1.5 times the basic rate of pay for hours over 40 in a workweek5960. The Federal Acquisition Regulation leaves its clause out of contracts valued at or below $200,000 and of contracts for commercial products and commercial services61.
Executive Order 13658 sets a minimum wage that generally must be paid on the contracts it covers: $13.65 an hour from May 11, 2026, and $14.05 from January 6, 20276263. The Department of Labor says it applies to certain contracts entered into between January 1, 2015 and January 29, 2022 that were not renewed or extended on or after January 30, 202264. The Department also says Executive Order 14026 was revoked on March 14, 202564.
Under Executive Order 13706, employees on covered contracts accrue not less than 1 hour of paid sick leave for every 30 hours worked49. A contractor may limit accrual to not less than 56 hours in each accrual year49.
What does an employer have to be able to show?
- The hours worked each workday and the total hours worked each workweek, for each employee the minimum wage or overtime rules cover65.
- Payroll records kept for at least 3 years, with written agreements, or memoranda of oral ones, under section 7(j), the 14-day period for hospitals and residential care342.
- Time and earning cards with each employee's daily starting and stopping time, and wage rate tables, kept for at least 2 years5.
What does the law leave open?
Overtime on smaller and commercial federal contracts. The statute covers contracts over $100,00058. The Federal Acquisition Regulation leaves the clause out of contracts valued at or below $200,000 and of contracts for commercial products and commercial services61. How the act applies to a contract without the clause is a question for your contracting officer or your counsel.
Which federal contracts carry Executive Order 13658's rate. The Department of Labor says the rates apply to certain types of contracts entered into between January 1, 2015 and January 29, 2022 that were not renewed or extended on or after January 30, 202264. Whether a given contract was renewed or extended is a question for your contracting officer or your counsel.
What does the law say exactly?
(1) Except as otherwise provided in this section, no employer shall employ any of his employees who in any workweek is engaged in commerce or in the production of goods for commerce, or is employed in an enterprise engaged in commerce or in the production of goods for commerce, for a workweek longer than forty hours unless such employee receives compensation for his employment in excess of the hours above specified at a rate not less than one and one-half times the regular rate at which he is employed.
29 U.S.C. § 206(a)(1)(C) the federal minimum wage
Every employer shall pay to each of his employees who in any workweek is engaged in commerce or in the production of goods for commerce, or is employed in an enterprise engaged in commerce or in the production of goods for commerce, wages at the following rates: (1) except as otherwise provided in this section, not less than— (A) $5.85 an hour, beginning on the 60th day after May 25, 2007; (B) $6.55 an hour, beginning 12 months after that 60th day; and (C) $7.25 an hour, beginning 24 months after that 60th day;
Department of Labor, Handy Reference Guide what the FLSA does not require
While the FLSA does set basic minimum wage and overtime pay standards and regulates the employment of minors, there are a number of employment practices which the FLSA does not regulate. For example, the FLSA does not require: vacation, holiday, severance, or sick pay; meal or rest periods, holidays off, or vacations; premium pay for weekend or holiday work; pay raises or fringe benefits; or a discharge notice, reason for discharge, or immediate payment of final wages to terminated employees.
29 CFR 785.18 rest periods are hours worked
Rest periods of short duration, running from 5 minutes to about 20 minutes, are common in industry. They promote the efficiency of the employee and are customarily paid for as working time. They must be counted as hours worked. Compensable time of rest periods may not be offset against other working time such as compensable waiting time or on-call time.
29 CFR 785.19 meal periods
(a) Bona fide meal periods. Bona fide meal periods are not worktime. Bona fide meal periods do not include coffee breaks or time for snacks. These are rest periods. The employee must be completely relieved from duty for the purposes of eating regular meals. Ordinarily 30 minutes or more is long enough for a bona fide meal period. A shorter period may be long enough under special conditions. The employee is not relieved if he is required to perform any duties, whether active or inactive, while eating. For example, an office employee who is required to eat at his desk or a factory worker who is required to be at his machine is working while eating. […] (b) Where no permission to leave premises. It is not necessary that an employee be permitted to leave the premises if he is otherwise completely freed from duties during the meal period.
29 CFR 778.601 the 14-day period for hospitals
The exemption provided by section 7(j) applies: if, pursuant to an agreement or understanding arrived at between the employer and employee before performance of the work, a work period of 14 consecutive days is accepted in lieu of the workweek of 7 consecutive days for purposes of overtime computation and if, for his employment in excess of 8 hours in any workday and in excess of 80 hours in such 14-day period, the employee receives compensation at a rate not less than one and one-half times the regular rate at which he is employed. […] The agreement or understanding between the employer and employee to use the 14-day period for computing overtime must be entered into before the work to which it is intended to apply is performed.
29 CFR 516.5 records kept 3 years
Each employer shall preserve for at least 3 years: (a) Payroll records. From the last date of entry, all payroll or other records containing the employee information and data required under any of the applicable sections of this part, and […] (5) Written agreements or memoranda summarizing the terms of oral agreements or understandings under section 7(g) or 7(j) of the Act, and
29 CFR 516.6 records kept 2 years
(a) Supplementary basic records: Each employer required to maintain records under this part shall preserve for a period of at least 2 years. (1) Basic employment and earnings records. From the date of last entry, all basic time and earning cards or sheets on which are entered the daily starting and stopping time of individual employees, or of separate work forces, or the amounts of work accomplished by individual employees on a daily, weekly, or pay period basis (for example, units produced) when those amounts determine in whole or in part the pay period earnings or wages of those employees. (2) Wage rate tables. From their last effective date, all tables or schedules of the employer which provide the piece rates or other rates used in computing straight-time earnings, wages, or salary, or overtime pay computation.
41 U.S.C. § 6702(a) contracts the Service Contract Act covers
(a) In General.—Except as provided in subsection (b), this chapter applies to any contract or bid specification for a contract, whether negotiated or advertised, that— (1) is made by the Federal Government or the District of Columbia; (2) involves an amount exceeding $2,500; and (3) has as its principal purpose the furnishing of services in the United States through the use of service employees.
40 U.S.C. § 3701 watchmen and guards on federal contracts
(2) Laborers and mechanics.—This chapter applies to all laborers and mechanics employed by a contractor or subcontractor in the performance of any part of the work under the contract— (A) including watchmen, guards, and workers performing services in connection with dredging or rock excavation in any river or harbor of the United States, a territory, or the District of Columbia; but (B) not including an employee employed as a seaman. […] (3) Exceptions.— (A) This chapter.—This chapter does not apply to— […] (iii) a contract in an amount that is not greater than $100,000.
Federal Register, October 8, 2026 the 2027 contractor minimum wage
Beginning on January 6, 2027, the Executive Order 13658 minimum wage rate that generally must be paid to workers performing work on or in connection with contracts covered by Executive Order 13658 will increase to $14.05 per hour, while the required minimum cash wage that generally must be paid to tipped employees performing work on or in connection with covered contracts will increase to $9.85 per hour. […] DATES: These new Executive Order 13658 rates shall take effect on January 6, 2027.
How does a system hold these rules?
Federal, state and city rules land on the schedule, the timecard and payroll at the same time. This is how they come together in WorkAxle:
- Daily and weekly hours, consecutive days and rest between shifts are set up as rules, each with its start date.
- While the schedule is built, the platform flags each shift that breaks one of those rules and names the rule. The supervisor decides.
- Each clock-in and clock-out is recorded with its time, and at the close of the period hours come out classified by your rules, ready for your payroll system.
The supervisor keeps the last word.
What can you check this week?
- List your sites by state and city, and check each against the table above and against that state's and city's own labor pages.
- Check that timecards keep each employee's daily starting and stopping times for at least 2 years, and payroll records for at least 353.
- For federal contracts with guards on them, find the wage determination in each contract, the contract's value and whether it carries the overtime clause565861.
- On contracts that may carry Executive Order 13658, mark January 6, 2027 for the new rate63.
Sending it to finance, operations or your counsel? The printed brief carries the rules and the sources.
This text does not constitute legal advice. Obligations vary by establishment and change over time. Confirm yours with the U.S. Department of Labor, the labor department of your state and city, or a qualified advisor.
Frequently asked questions
What is the federal minimum wage?
$7.25 an hour for covered, nonexempt employees, effective July 24, 20096. Where an employee is subject to both a state and the federal minimum wage, the employee is entitled to the higher of the two11.
Does federal law require overtime after 8 hours a day?
The FLSA's rule is weekly: unless exempt, covered employees get at least 1.5 times the regular rate for hours over 40 in a workweek24. Hospitals and residential care establishments may agree in advance to a 14-day period with overtime after 8 hours a day and 80 in the period42. Some states add daily overtime, such as Alaska after 8 hours a day at employers of four or more38.
Does federal law require breaks?
The FLSA does not require meal or rest periods9. Rest periods running from 5 minutes to about 20 minutes that an employer allows must be counted as hours worked44. The FLSA does require reasonable break time each time an employee needs to express breast milk, for 1 year after a child's birth, and a place other than a bathroom, shielded from view and free from intrusion, with an undue-hardship exemption for employers of fewer than 5010.
How long do employers have to keep payroll records under the FLSA?
Payroll records for at least 3 years, and time cards with daily starting and stopping times for at least 2 years35.
Does the Service Contract Act cover security guards?
The Service Contract Act covers federal contracts over $2,500 whose principal purpose is furnishing services through service employees55. Guard and watchman security service is among the services found to be covered57.
What is the federal contractor minimum wage in 2027?
Under Executive Order 13658, $14.05 an hour from January 6, 202763, only on certain contracts entered into between January 1, 2015 and January 29, 2022 and not renewed or extended on or after January 30, 202264. Executive Order 14026 was revoked on March 14, 202564.
Does federal law require family or medical leave?
The Family and Medical Leave Act gives eligible employees unpaid, job-protected leave for qualifying family and medical reasons50, up to 12 workweeks in a 12-month period51, or up to 26 workweeks in a single 12-month period for a spouse, child, parent or next of kin caring for a covered servicemember52. It covers private employers with 50 or more employees in 20 or more workweeks in the current or previous calendar year and, of any size, public agencies and public and private elementary and secondary schools5354.
https://www.workaxle.com/compliance-center/united-states