Generally, the FLSA mandates overtime pay at a rate of one-and-a-half times the regular rate for non-exempt employees who work more than 40 hours per week. See 29 U.S.C. § 207(a)(1).
EXAMPLE:[1] Kyle’s payroll records show a total “overtime” amount of $15,000 for 2025, which represents the total compensation received for hours worked in excess of 40 hours per work week—the regular rate compensation and “qualified overtime compensation.” For purposes of determining the amount of qualified overtime compensation received in tax year 2025, Kyle may include $5,000 (computed by dividing $15,000 by 3).
Section 7(k) provides a partial exemption from overtime requirements for qualifying fire protection and law enforcement employees. Under that provision, law enforcement may be paid overtime on a “work period” basis. The regulations define a work period as “any established and regularly recurring period of work which, under the terms of the Act and legislative history, cannot be less than seven consecutive days nor more than twenty-eight consecutive days.” 29 C.F.R. § 553.224(a). For law enforcement, “no overtime compensation is required under section 7(k) until the number of hours worked exceeds the number of hours which bears the same relationship to 171 as the number of days in the work period bears to 28.” 29 C.F.R. § 553.230(c). Accordingly, overtime compensation for law enforcement—in premium pay or compensatory time—is required for all hours worked in excess of the following maximum hours standards (rounded to the nearest whole hour):
| Work Period | Maximum Hours for Law Enforcement |
| 7 | 43 |
| 14 | 86 |
| 21 | 128 |
| 28 | 171 |
For example, if an employer adopts a fourteen-day work period, overtime compensation is not due until such time as the employee has worked more than 86 hours during the 14-day work period. 29 C.F.R. § 553.230(b).
EXAMPLE: Joe works in law enforcement and is paid $15,000 of total annual overtime pay on a “work period” basis of 14 days that complies with section 207(k) of the FLSA (i.e., overtime for working more than 86 hours in a 14-day work period). For purposes of determining the amount of qualified overtime compensation received in tax year 2025, Joe may include $5,000 ($15,000 divided by 3).
SPECIAL NOTE FOR SMALL AGENCIES: Section 13(b)(20) of the FLSA provides a complete overtime exemption to law enforcement or fire protection employees of a public agency that employs less than five employees during the workweek in law enforcement or fire protection activities. As qualified overtime compensation is the portion of overtime pay that is required under Section 7 of the FLSA, arguably, small agencies that pay overtime even though they are not required to so, may not have eligible “qualified overtime.” Hopefully, future IRS guidance will clarify this issue.
[1] These examples come from IRS Notice 2025-69.
