Generally speaking, sick leave and holiday pay do not count toward overtime pay. This means that a person could technically be paid for more than 40 hours in a week without qualifying for overtime.
For example, say that a person was sick on Monday and took paid time off. They then returned to work on Tuesday and worked eight hours every day through Saturday.
They would be paid for a total of 48 hours, which would typically trigger overtime at a time-and-a-half rate. But because the eight hours on Monday were sick leave, they would not count toward overtime, and the entire amount would be paid at the standard rate.
Why does this happen?
Broadly speaking, the law is set up this way because no work was actually performed during that time. This does not prevent a person from using sick leave, just as many employees are entitled to holiday pay if a holiday falls during the workweek.
But since they did not actually work those hours, they do not count toward overtime calculations. From an overtime perspective, the employee has only worked 40 hours during the pay period.
Resolving wage and hour disputes
As an employer, it is important to understand when overtime pay does and does not apply. In California, double-time pay may also be required in certain situations, such as when a worker logs more than 12 hours in a single day.
The above illustrates how the rules can become complex, and misunderstandings about how the law applies can lead to disputes between employers and employees. At these times, it is important for all involved to fully understand their legal options.