The Pennsylvania Supreme Court recently found that a federal standard of calculating overtime is non-complaint with its state wage and hour laws. Specifically, the Court found that the Fluctuating Work Week (FWW) method of calculating overtime wages, adopted under the Fair Labor Standards Act, does not adequately compensate non-exempt employees at a time and half rate for hours worked over the standard 40 hour work week, as required by Pennsylvania Minimum Wage Act (PMWA). The FWW methods is currently used by many companies throughout the U.S., including New Jersey. Because of the similarities between Pennsylvania and New Jersey state wage and hour and wage payment laws, this decision may impact the rate at which some New Jersey’s employees are payed for their over time work.
Under the FWW method of calculating over time, it is permissible for an employer to calculate a non-exempt employees’ wages in the following way:
- The employee works hours that fluctuate from week to week;