Virginia's new overtime law has real teeth

Virginia's wave of employee-friendly legislation continues. In 2020, the General Assembly greatly expanded the scope of the Commonwealth's employment discrimination laws and began the process of hiking its minimum wage toward a $15-per-hour target. This year, lawmakers turned their attention to overtime protections by enacting the Virginia Overtime Wage Act, which takes effect July 1, 2021.

New overtime calculation requirements

The new wage law specifically requires employers to pay 1½ times an employee's regular pay rate for hours worked in excess of 40 in a workweek. For nonexempt employees paid on an hourly basis, the regular rate is not only her hourly pay rate but also other wages, such as commissions or nondiscretionary bonuses paid or allocated during the workweek.

As written, the new law would seem to preclude employers from paying nonexempt employees a fixed salary to cover wages for hours in excess of 40 in a workweek on a fluctuating workweek (FWW) basis, a method allowed under federal law. Instead, you must pay time and one-half for each hour an exempt employee works over 40 without exception.

New penalties for employers

Not only does the new law favor employees in calculating the overtime rate, it also incorporates special protections for workers seeking to enforce their overtime rights. Importantly, the protections provide for greater penalties on employers that fail to pay the proper amount of overtime and strengthen the procedures employees may use to enforce their rights.