Who this is for: Salaried workers who think they were wrongly classified exempt and want a rough number.

What's going on: You worked past 40 hours for a flat salary and got nothing extra.

What you can do: Gather your salary, your typical weekly hours, and your dates of employment. Then run the math below.

A misclassified salaried worker is generally owed unpaid overtime for every week in the last two years (three if the violation was willful), plus an equal amount in liquidated damages, so the federal claim is often double the unpaid overtime itself.

The formula

1. Weekly pay. Annual salary ÷ 52.
2. Regular rate. Weekly pay ÷ the hours the salary was meant to cover.
3. Weekly overtime. Regular rate × the overtime multiplier (1.5 or 0.5, see below) × hours over 40.
4. Back pay. Weekly overtime × weeks worked in the look-back period.
5. Liquidated damages. An "additional equal amount".¹

Time-and-a-half or half-time? Courts differ

For a salaried worker, the regulation says the regular rate is computed "by dividing the salary by the number of hours which the salary is intended to compensate".² The fight is over which hours that is.

• Time-and-a-half method. The salary paid for 40 hours. You're owed 1.5 × the rate for every hour over 40.
• Half-time method. The salary paid for all hours, whatever they were. The rate is lower and you're owed only an extra 0.5 × the rate for hours over 40. This borrows from the fluctuating-workweek rule,³ which requires "a clear and mutual understanding that the fixed salary is compensation ... for the total hours worked each workweek."

Several federal appeals courts have approved the half-time method in misclassification cases, including the Fifth Circuit,⁴ the Tenth,⁵ and the Fourth.⁶ Other courts have used time-and-a-half, especially where there was no real understanding that the salary covered all hours. California rejects the half-time method by statute: the regular hourly rate of a nonexempt salaried employee “shall be 1/40th of the employee's weekly salary,” and a fixed salary “shall be deemed to provide compensation only for the employee's regular, nonovertime hours, notwithstanding any private agreement to the contrary.”¹¹

Worked example

Illustrative, not a prediction. $55,000 salary, 50 hours a week, 50 working weeks a year. Weekly pay $1,057.69.

Same worker. Same hours. A claim of about $21,000 or about $119,000, depending on the method and the look-back. That gap is why the method matters and why the hours evidence matters.

When liquidated damages can be cut

Doubling is the default. A court may reduce or deny it only "if the employer shows to the satisfaction of the court that the act or omission giving rise to such action was in good faith and that he had reasonable grounds for believing that his act or omission was not a violation".⁷ That's the employer's burden.

State add-ons

• Illinois: “treble the amount of any such underpayments together with costs and such reasonable attorney's fees as may be allowed by the Court,” plus “damages of 5% of the amount of any such underpayments for each month ... during which such underpayments remain unpaid,” and a three-year look-back.¹² See Illinois overtime law.
• New Mexico: the unpaid or underpaid wages “plus interest, and in an additional amount equal to twice the unpaid or underpaid wages.”¹³ See New Mexico overtime law.
• Other states: see state overtime laws. State claims can run alongside the FLSA claim.

What makes a claim bigger

• More hours over 40, every week.
• A longer job, up to the look-back limit.
• A higher salary (higher regular rate).
• Willfulness, which adds the third year.
• A state law with bigger damages or a longer look-back.
• Nondiscretionary bonuses that should have been in the regular rate.

No time records? The employer had the duty to keep them. When it didn't, workers can prove hours by reasonable estimate.⁸

Why group cases are worth more than the sum of one-off claims

• One case proves the policy once, for everyone in the job.
• Company-wide records (logins, badge data, emails) come out in discovery.
• The employer pays the workers' attorney's fees if they win.¹
• Your own lookback period is measured from the date you file a written consent to join. See collective actions.

Siegel Law Group has recovered more than $100 million for workers in federal overtime cases, including a $38.7 million class and collective settlement in Pruess v. Presbyterian Health Plan,⁹ where the firm was lead counsel. Past results do not guarantee future outcomes.

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Get your number

Bring your salary, dates, and honest estimate of weekly hours. We'll run both methods and tell you what the evidence supports.

Questions we hear

Is the back pay taxed?

The IRS treats overtime back pay as wages — reported on Form W-2 and subject to withholding. Liquidated damages are income but not wages, and are reported on Form 1099-MISC.¹⁴ See no tax on overtime for salaried workers.

Do I get interest too?

Under the FLSA, liquidated damages take the place of prejudgment interest. The Supreme Court put it flatly: “Interest is not recoverable in judgments obtained under § 16 (b).”¹⁵ Some state laws add interest.

What if I quit or was fired?

Former employees can recover the same back pay, inside the look-back period.

Does the employer pay my lawyer?

If you win, the FLSA requires it. See what an overtime lawyer costs.

Keep reading

• Do nonprofits have to pay overtime?
• Are social workers exempt?
• Service and support coordinators
• Foster care and child welfare caseworkers
• Behavioral health case managers
• Are nurses exempt from overtime?
• Am I misclassified as exempt? The 10-question check
• The 2026 exempt salary threshold
• No tax on overtime for salaried workers
• The learned professional exemption
• Got a notice about an overtime lawsuit?
• What an overtime lawyer costs
• Day-rate overtime: paid by the day isn't a salary
• Signed an arbitration agreement?
• Prior authorization nurses
• Case manager overtime lawsuits
• Utilization review nurse overtime
• Salary vs. hourly: who gets overtime
• How far back a claim reaches

Free, confidential case review: (214) 790-4454.

We take overtime cases on contingency. We advance the costs of the case, and if we recover, those costs are repaid out of the recovery. If we do not recover, you owe us nothing — no attorney's fee and no costs.

Notes

1. 29 U.S.C. § 216(b).
2. 29 C.F.R. § 778.113(a).
3. 29 C.F.R. § 778.114.
4. Black v. SettlePou, P.C., 732 F.3d 492 (5th Cir. 2013).
5. Clements v. Serco, Inc., 530 F.3d 1224 (10th Cir. 2008).
6. Desmond v. PNGI Charles Town Gaming, 564 F.3d 688 (4th Cir. 2009).
7. 29 U.S.C. § 260.
8. Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680 (1946).
9. Pruess v. Presbyterian Health Plan (D.N.M.), final approval June 24, 2026.
10. See also: 29 U.S.C. § 255 (two/three-year limit).
11. Cal. Lab. Code § 515(d)(1)–(2).
12. 820 ILCS 105/12(a) (“Every such action shall be brought within 3 years from the date of the underpayment.”).
13. NMSA 1978 § 50-4-26(C).
14. IRS PMTA 2009-035 (Oct. 22, 2008), Income and Employment Tax Consequences and Proper Reporting of Employment-Related Judgments and Settlements (“back pay is wages for FICA and income tax withholding purposes”; summary table: overtime reported on Form W-2, punitive/liquidated damages on Form 1099-MISC, Box 3).
15. Brooklyn Savings Bank v. O'Neil, 324 U.S. 697, 715 (1945) (§ 16(b) “authorizes the recovery of liquidated damages as compensation for delay in payment of sums due under the Act”).