If I work more than 40 hours in a week, can I get compensatory time instead of overtime pay?

Most workers are familiar with compensatory, or "comp" time -- the practice of offering employees time off from work rather than pay for working overtime. What comes as a shock to many is that the practice is generally illegal under federal law, at least for private employers (state and local governments can offer comp time, in certain circumstances). The reason? Comp time policies prevent employees from collecting overtime premiums -- the 50% more of an employee's usual hourly wage he or she gets when earning time and a half during overtime.

When comp time is allowed, it must be awarded at the rate of one and one-half times the overtime hours worked -- and it must be taken during the same pay period that the overtime hours were worked.

If you are an exempt employee -- that is, you are not entitled to overtime pay under the FLSA -- you may legally work out a comp time arrangement with your employer.

Some states do allow private employers to give employees comp time instead of cash. But there are complex, often conflicting laws controlling how and when it may be given. A common control, for example, is that employees must voluntarily request in writing that comp time be given instead of overtime pay -- before the extra hours are worked. Check with your state's labor department for special laws on comp time in your area.

Many employers and employees routinely violate the rules governing the use of compensatory time in place of cash overtime wages. However, such violations are risky. Employees can find themselves unable to collect money due to them if a company goes out of business or they are fired. And employers can end up owing large amounts of overtime pay to employees, if an employee complains about the practice or the company faces a labor department audit.

I work as a waitress and make good tips. But my boss says that because I get this extra money at work, I can be paid lower than the hourly minimum wage. Is this true?

It depends on how much money you make in tips and on the laws of the state where you work. Employers must pay all employees covered by the federal wage law (FLSA) not less than the minimum wage -- currently $5.15 an hour. And some states have established a minimum wage that is higher than the federal one; if you live in one of these states, you are entitled to the higher rate.

However, the law gets a bit trickier when the employee earns tips. Under federal law, an employer is allowed to pay a lower minimum wage -- only $2.13 an hour -- if the employee routinely earns at least $30 per month in tips. However, the employer can do this only if the worker's wages plus tips add up to at least the minimum wage for each hour worked. If the worker ends up earning less than the minimum wage even when tips are figured into the bargain, the employer has to make up the difference.

What laws ensure my right to take vacations?

Here's a surprising legal truth that most workers would rather not learn: No law requires employers to pay you for time off, such as vacation or holidays. This means that if you receive a paid vacation, it's because of custom, not law.

And just as vacation benefits are discretionary with each employer, so is the policy of how and when they accrue. For example, it is perfectly legal for an employer to require a certain length of employment -- six months to a year is common -- before an employee is entitled to any vacation time. It is also legal for employers to prorate vacations for part-time employees, or to deny them the benefit completely. Employers are also free to set limits on how much paid time off employees may store up before it must be lost or taken.

Copyright 2007 Nolo

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