Can You Exchange Overtime for Comp Time? - Barrett & Farahany

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Can You Exchange Overtime for Comp Time?

Can You Exchange Overtime for Comp Time?

You’ve been working hard on a project for your company, putting in 48 hours instead of the standard 40-hour workweek.

To thank you, your manager gives you a day off in comp time the following week so you can spend time with your family. While the act appears to be one of generosity, in fact, it may be illegal and a way for your employer to get out of paying you what you’ve earned.

Unless you’re exempt from overtime pay according to Fair Labor Standards Act (FLSA) regulations, your employer cannot offer you comp time in place of time and a half pay for every hour you work over 40 hours. By law, they must pay you for your time, and if by chance they still want to offer you paid time off on top of those hours, that’s just an added benefit.

Time off for hourly or salaried workers nonexempt from FLSA laws can be offered in the following ways:

  • If you have to work 10 hours in a day to meet a deadline instead of your usual 8, your employer can reduce the number of work hours the other days of the week so you don’t go over 40 hours in a week.
  • If you’re paid every two weeks and work 50 hours one week, you can be paid overtime that week and then have your hours reduced the next so that your paycheck remains consistent.

The law can frustrate many employees who actually want time with their families as opposed to extra income. However, the law is in place to prohibit companies from overworking employees or abusing the flexibility of workers. As FLSA stands currently, comp time in exchange for overtime pay is illegal even if you and your employer agree to it – though there is a very slight possibility the law could change.

In 2013, the House of Representatives passed the Working Families Flexibility Act which would allow nonexempt employees to stockpile up to 160 hours of comp time in a year instead of taking overtime pay. If an employee does not use the comp time by the end of the year, he or she would be paid the overtime earned.

While it sounds promising by giving employees more flexibility, it is unlikely to pass for good reason. Critics believe employees would not be able to decide when they could use their comp time and that they could be forced into working erratic schedules. They are also concerned that if a company goes out of business, workers would lose both their comp time and overtime pay.

Although comp time still regularly happens and usually under the table, that fact is in most cases it’s the company who benefits by illegally neglecting to pay employees what they’ve earned. While comp time seems like a good option, it limits your earning potential in your career.

If your employer is insisting on offering comp time as opposed to overtime pay, contact the Wage-Hour Division of the U.S. Department of Labor or consult an employment lawyer experienced in overtime law in order to file a claim and protect your financial interests.


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