Should paid time off count toward the 40-hour overtime threshold?

• A. No
• B. Only for salaried employees
• C. Only if PTO is earned the same week
• D. Yes

Answer: (D)

Overtime is determined by hours paid in the workweek, not only by hours actually spent working. Paid time off is still compensated time, so it counts toward the weekly total used to decide if overtime is due. For example, if an employee has 40 hours of work in a week but takes 8 hours of PTO, the total paid time becomes 48 hours. That pushes past the 40-hour mark, so those PTO hours are paid at the overtime rate. The essential idea is that PTO represents compensable time and is included when calculating whether overtime applies. If the time off were unpaid, it would not be counted toward the threshold.