Does your employer give you paid time off instead of overtime pay?
Some employers will give employees paid time off instead of paying them overtime wages. Except in certain circumstances, this is illegal under the federal Fair Labor Standards Act and employees who are eligible for overtime wages should get educated about their FLSA rights.
Can a company insist that non-exempt employees take paid time off instead of being paid for working overtime?
Using comp time instead of overtime pay is limited by the FLSA to public agencies that are a state, political subdivision of a state, or an interstate governmental agency. In most other situations, "comp time" (time off instead of overtime pay) is illegal under the FLSA. Non-exempt employees under federal labor laws who work over 40 hours in a work week must be paid for every hour you work, plus time-and-a-half for your overtime rate.
Can my employer provide vacation time instead of overtime wages?
Usually, if you are eligible for overtime pay you have to be compensated for all hours you work. If you are not exempt you must also be paid overtime for any hours worked over 40 in a work week. This is federal labor law, and all non-exempt employees fall under FLSA regulations.
Bottom line: If you are eligible for overtime, you must be paid; employers may not substitute comp time or time off for overtime wages.
Find out why your job title is irrelevant in determining your eligibility status under the labor laws: The federal Fair Labor Standards Act Overview
Are you eligible for overtime? Watch this video to get answers to your eligibility questions: Texas Employee Wage Rights