Hourly Employee

What is Hourly Employee?

An hourly employee is a worker who receives a set pay rate for every hour they work, rather than a fixed annual salary. Compensation is calculated by multiplying the hourly rate by the total hours worked in a pay period, including any applicable overtime.

Why Hourly Employee Matters

Under the Fair Labor Standards Act (FLSA), hourly employees are generally classified as non-exempt, meaning they must be paid at least the federal minimum wage and are entitled to overtime pay at one and a half times their regular rate for hours worked beyond 40 in a workweek. Employers must keep accurate time records for hourly workers, and HR teams should ensure that scheduling and timekeeping practices comply with both federal and state wage laws.