Are employers required to pay for unauthorized overtime?

Yes. An employer is required to pay an employee who works overtime regardless of whether the employee received permission to perform the work.

According to §785.11  of the Fair Labor Standards Act (FLSA) regulations, "Work not requested but suffered or permitted is work time. For example, an employee may voluntarily continue to work at the end of the shift. He may be a pieceworker, he may desire to finish an assigned task or he may wish to correct errors, paste work tickets, and prepare time reports or other records. The reason is immaterial. The employer knows or has reason to believe that he is continuing to work and the time is working time."

Furthermore §785.13  of the regulations states, "In all such cases it is the duty of the management to exercise its control and see that the work is not performed if it does not want it to be performed. It cannot sit back and accept the benefits without compensating for them. The mere promulgation of a rule against such work is not enough. Management has the power to enforce the rule and must make every effort to do so."

As the above regulatory language indicates, even a clearly communicated policy prohibiting unauthorized overtime does not relieve an employer from its legal obligation to pay employees for all hours worked. Therefore, if the employer allows the employee to perform the work, the employer is liable for compensating the employee. This point is reiterated and further explained in regard to employees who are working from home in the Department of Labor's Field Assistance Bulletin No. 2020-5.

However, the FLSA does not prohibit employers from implementing a policy or enforcing an existing policy that prohibits unauthorized work, and it does not prohibit employers from disciplining employees for violating the policy.

Employers wishing to avoid the legal liability of paying for unauthorized overtime can actively discourage employees from working extra hours by designing, implementing and enforcing a clearly communicated policy as well as by providing managers and supervisors with appropriate training to better prepare them to enforce the policy in a consistent manner.