US Overtime Rules 2026: Who Qualifies and How Much Extra You Earn

Work more than 40 hours in a week in the United States and your employer generally owes you extra — one and a half times your normal hourly rate for every hour over 40. That is the core of US overtime law, and it applies to far more workers than most people realise. In 2026 the rules got simpler at the federal level but stricter in a growing list of states, so whether you actually qualify depends on three things: how you are paid, how much you earn, and where you work.

The 40-hour rule: the one line that decides everything

Under the federal Fair Labor Standards Act (FLSA), covered employees must be paid overtime at at least 1.5 times their regular rate for all hours worked over 40 in a single workweek. The Department of Labor’s Fact Sheet #23 spells out the key mechanics:

• The 40-hour clock runs on a fixed 7-day workweek (168 hours), not the calendar week and not the pay period.
• Hours cannot be averaged across two or more weeks — 50 hours one week and 30 the next still means 10 overtime hours in week one.
• The law does not require overtime for weekends, nights, or holidays as such — only for hours over 40 in the workweek.
• There is no federal cap on how many hours an adult employee may work in a week.

Who qualifies for overtime pay in 2026?

Most hourly workers qualify, and so do many salaried ones. You are generally entitled to overtime if any of these apply:

• You are paid hourly. Hourly employees are almost always non-exempt — your 41st hour onward earns the 1.5x premium.
• You are salaried but earn less than $35,568 a year. Below the federal salary threshold ($684 per week), no job title or set of duties can make you exempt.
• You are misclassified. Job titles do not decide exemption — actual duties and pay level do. If your employer calls you “exempt” but your work does not pass the duties test, you may be owed back overtime.
• You work in a state with a higher threshold. If your salary clears the federal bar but falls short of your state’s, your state law makes you non-exempt (more on this below).

Salaried and unsure what your hours are worth? Our hourly-to-salary converter breaks any annual salary into its true hourly equivalent — the number every overtime calculation starts from.

Who does NOT qualify: the three tests for exemption

To be legally exempt from overtime, an employee must pass all three of the FLSA’s tests:

1. Salary-basis test — paid a fixed salary that does not change with the quantity or quality of work (not hourly).
2. Salary-level test — in 2026, at least $684 per week ($35,568 per year). For highly compensated employees the bar is $107,432 per year in total compensation.
3. Duties test — the employee’s primary duties genuinely fit an exempt category: executive, administrative, professional, computer employee, or outside sales.

Outside salespeople and certain computer professionals have their own rules, and teachers, doctors, and lawyers are exempt from the salary-level test altogether. But the crucial point: earning above $35,568 does not by itself make you exempt — you must also pass the duties test.

The 2024 overtime rule was struck down — here is what applies in 2026

If you have seen “$58,656” quoted as the overtime threshold, that number comes from a Department of Labor rule issued in 2024, which would have raised the bar to $844 per week in July 2024 and $1,128 per week in January 2025. A federal court in Texas vacated the rule nationwide in November 2024, and on May 15, 2026 the DOL formally rescinded it in the Federal Register, restoring the 2019 thresholds. So for 2026 the operative federal figures are the ones above: $684 per week and $107,432 for highly compensated employees — exactly as they were before the 2024 rule was ever issued (HRD’s summary of the rollback).

The practical upshot: many employers who raised salaries or reclassified staff in anticipation of the 2024 rule are now re-auditing those decisions — which is another reason to check your own classification rather than assume it is correct.

State rules that pay more than federal law

Federal law is only the floor. When a state sets a higher bar, the higher standard wins. In 2026 these states demand more than the federal $35,568:

• California — $70,304 per year ($1,352/week). Nearly double the federal threshold. California also triggers overtime daily: 1.5x after 8 hours in a day and double time after 12 hours, even in a week under 40 hours.
• Washington — $80,168.40 per year for employers with 51+ employees ($69,305.60 for smaller employers). The highest threshold in the country.
• New York — $66,300 per year ($1,275/week) in New York City, Long Island, and Westchester; $62,353.20 per year ($1,199.10/week) elsewhere in the state (executive and administrative exemptions; no separate state threshold for the professional exemption).
• Colorado — $57,784 per year, indexed and adjusted annually.
• Alaska — about $58,240 per year after a mid-2026 increase.
• Maine — $43,951 per year.

The bottom line from current threshold tracking: an employee earning $60,000 can be fully exempt under federal law yet entitled to overtime in California, Washington, or New York. If you work in one of these states, your state’s number — not Washington DC’s — is the one that matters.

How much extra do you actually earn?

Overtime pay is calculated on your regular rate — not just your base hourly wage. The regular rate includes non-discretionary bonuses, commissions, and piece-rate earnings, divided by all hours worked. Discretionary bonuses, gifts, and holiday pay are excluded.

Worked example. You earn $25 an hour and work 50 hours this week:

• Straight time: 40 × $25 = $1,000
• Overtime rate: $25 × 1.5 = $37.50 per hour
• Overtime pay: 10 × $37.50 = $375
• Total for the week: $1,375 — that is $375 more than a 40-hour week

Salaried example. You earn a $50,000 salary and are non-exempt. Your hourly equivalent is $50,000 ÷ 2,080 = $24.04/hour, so each overtime hour pays $36.06. Work 45 hours and the extra 5 hours are worth $180.29 on top of your normal weekly pay. (Use our overtime pay calculator to run your own numbers instantly.)

Negotiating your pay this year? Run the numbers through our pay raise calculator first — a raise that lifts you over your state’s exemption threshold can change your overtime rights, not just your salary.

New for 2026: a federal tax deduction on overtime pay

The One Big Beautiful Bill Act created a new federal income-tax deduction tied to qualified overtime compensation, available for tax years 2025 through 2028. Starting with tax year 2026, employers must report qualified overtime separately on W-2s (Box 12, code “TT”) so the deduction can be claimed. The deduction expires after 2028, and the details — exactly which pay counts as “qualified” — are still being finalised, so treat this as a developing story and check with a tax professional before filing.

Overtime rules 2026: frequently asked questions

Am I entitled to overtime if I am paid a salary?

Quite possibly. Salary alone does not make you exempt. If you earn less than $35,568 a year (or less than your state’s higher threshold), you are entitled to overtime regardless of your job title. Above that, you must also fail the duties test to qualify.

Does my employer have to pay overtime if it was not approved in advance?

Yes. Under the FLSA, overtime that you actually worked must be paid even if your manager did not pre-approve it. Your employer can discipline you for working unauthorised hours, but it cannot refuse to pay for them.

What if my state’s overtime threshold is higher than the federal one?

The higher standard applies. For example, a salaried employee earning $50,000 in California is entitled to overtime under state law even though federal law would allow an exemption.

Do I get overtime for working weekends or night shifts?

Not automatically. Federal law requires overtime only for hours over 40 in the workweek. Weekend or night premiums exist only if your employer, contract, or state law (like California’s daily overtime) provides them.

Can my employer average my hours across two weeks to avoid overtime?

No. Averaging hours over two or more weeks is explicitly prohibited. Each workweek stands alone: 50 hours in week one means 10 overtime hours, even if week two is only 30.

Is overtime pay taxed differently in 2026?

Overtime is taxed as ordinary income, like the rest of your wages. What is new is the 2025–2028 federal deduction on qualified overtime compensation (see above), which can reduce the tax you owe on it — a deduction, not an exemption from tax.

Disclaimer: this article explains the general rules and is not legal advice. Overtime classification depends on your specific duties, pay arrangement, and state — when in doubt, check your state labour department or an employment attorney.