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Daylight Savings Brings Payroll Puzzles, CCH Says

(RIVERWOODS, ILL., March 4, 2009) – Straight time or overtime? That
can be the question when clocks are set forward one hour this weekend, notes
CCH, a part of Wolters Kluwer Law & Business and a leading provider of human
resources information and software (

The arrival of daylight saving time requires clocks to be moved forward one
hour at 2:00 a.m. on Sunday, March 8. Shift workers who are on duty at that
time and who normally work an eight-hour shift will actually work only seven

“Some employers decide to pay the normal eight hours of pay for that
shift as a matter of policy, but under the Fair Labor Standards Act, they are
not required to include the additional hour of pay when calculating an employee’s
regular rate for overtime,” noted Heidi Henson, JD, CCH workplace analyst.
“For example, if someone actually works 40 hours in the week, the additional
hour’s pay for that daylight-saving hour would be at straight time, not
overtime,” Henson explained.

On the other hand, because the extra hour of pay is not compensation for hours
actually worked in the work week, no part of that amount may be credited toward
overtime compensation that may be due if the employee qualifies for overtime
during the rest of the work week.

“Let’s suppose an employee actually works 41 hours in the week,
and is also paid for the hour that isn’t worked due to daylight saving.
That employee is still entitled to overtime pay for one hour, and the pay for
the daylight-saving hour can’t be credited against it,” Henson added.

When returning to standard time on the first Sunday in November, clocks are
moved back one hour at 2:00 a.m. Shift workers on duty at that time will actually
work an extra hour, for a total of nine hours of work. Employees must be paid
for all nine hours. They are also entitled to overtime on the basis of all hours
worked during the week, including the extra hour worked during the conversion
to standard time.