It is the policy of The University of Texas Health Science Center at Houston to allocate and schedule work appropriately so that classified staff can accomplish their job responsibilities in a standard work week. At times, however, operational demands require that a supervisor request and schedule an employee to work beyond the hours in a standard work week. Employees who are classified as non-exempt are covered by the Fair Labor Standards Act of 1938 (FLSA), as amended, and must be compensated for hours worked over 40 in a standard work week either through granting overtime pay or compensatory time off. Overtime must be approved in advance by the employee's supervisor.
Supervisors of non-exempt employees are responsible for establishing work schedules as well as adherence to federal and state law and institutional policy. This policy applies to any and all hours where an employee is "suffered or permitted" to work in excess of 40 hours in the standard work week.
The provisions of the FLSA, as amended, provide tests for exemption from the overtime requirements of the FLSA, hence, the term "exempt" for positions that meet all of the established criteria in the FLSA. The employee's job classification will determine whether or not s/he is exempt or non-exempt. Positions that do not qualify for an exemption from the overtime provisions of the FLSA are referred to as "non-exempt" (not exempt from the overtime provisions of the FLSA). A list of specific classified job titles and the associated exempt, or non-exempt status of each is provided in the Classified Pay Plan.
A department manager who signs the employee's timesheet is authorized to grant compensatory time to non-exempt staff. It is the responsibility of the department manager to ensure that work is scheduled appropriately and that compensatory time can be granted for work above the standard work week not to exceed a maximum of 240 hours. The signature of the supervisor or department manager on an employee's time record will constitute granting of compensatory time as recorded on the time sheet.
In all cases, the institutional time sheet or time card for each classified employee will be the official record of time worked and time taken. Appropriate supporting documentation must be maintained in the department for paid overtime or each grant of compensatory time off made to any employee. All employees should record their total work week hours appropriately on their timesheets. (Refer to 2.27 Time and Attendance Reporting.)
There is no legal requirement, nor is the institution obligated to grant compensatory time off to exempt employees. A supervisor may choose to approve compensatory time off to an exempt employee for hours worked in excess of 40 hours in a standard work week at his or her discretion.
Employees in non-exempt positions must be compensated (either paid or granted compensatory time; also refer to 5.05 Overtime Pay) for all hours worked in excess of 40 in the standard work week. If the supervisor decides to grant compensatory time off instead of pay, the supervisor must inform the employee immediately.
An employee who has accrued compensatory time and requests use of the time must be permitted to use the time off within a "reasonable period" after making the request if it does not "unduly disrupt" the department's operations. Supervisors must grant compensatory time off to non-exempt employees at a rate of time and one-half (1-1/2) for each hour worked over 40 in the standard work week. In determining total work week hours, all hours a non-exempt employee is "suffered, permitted or required" to work must be counted. Hours not actually worked for which a non-exempt employee is paid, such as holiday, sick leave, or vacation, must be counted in determining total work week hours. However, an employee must actually work in excess of 40 hours in a week (i.e., not including paid leave) before the compensation rate of time and one-half is applied to hours worked in excess of 40.
All compensatory time earned by non-exempt employees in any work week must be taken during the 12-month period following the end of the workweek during which the overtime occurred; otherwise, supervisors must pay non-exempt employees for these hours.
Compensatory time accrued is subject to an accrual limitation of 240 hours (160 hours x 1.5 = 240). If a non-exempt employee accrues compensatory time in excess of the 240 hour cap, the employee must be paid for the excess number of hours immediately. Employees cannot accrue compensatory hours in excess of 240 in a twelve-month period. Supervisors can require an employee to take compensatory time off in order to manage the accrual limitation.
If compensatory time off is not taken during the rolling 12-month period or upon termination of the employee's employment, the supervisor must pay non-exempt employees at straight time for total hours of compensatory time off not taken during this 12-month period. The total compensatory hours reflect the time and one-half computation.
To identify total work week hours for the purpose of calculating compensation for a non-exempt employee, the following possible scenarios should be considered:
There is no legal requirement, nor is the institution obligated to pay overtime to exempt employees. Supervisors, however, may grant overtime to exempt employees for hours in excess of 40 hours in a work week in which the combination of hours worked, paid leave, and holidays exceeds a total of 40 hours. Compensatory time will be granted judiciously and only on an hour for hour basis.
In some cases, a supervisor may approve compensatory time off to the exempt employee for overtime the employee may be required to work. There are three situations in which, at the discretion of the supervisor and with the written advance approval of the head of the operating unit, exempt employees may be required to work and be paid for overtime hours they are required to work (refer to 5.05 Overtime Pay):
Payment for overtime would be made only when granting compensatory time off is not feasible, and the exempt employee will be paid at straight time. Supervisors must be consistent in applying the guidelines cited previously in this policy throughout their area(s) of responsibility when approving exempt employee overtime, whether monetary or compensatory time off.
Updated 08/05