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Overtime Reset: When Does Overtime Start Over?

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What Is an Overtime Reset?

An overtime reset refers to the point when the calculation of overtime hours starts over. Under the Fair Labor Standards Act (FLSA), overtime pay is based on a “workweek” — a fixed, recurring 7-day period. After each workweek ends, the overtime count resets to zero. It doesn’t carry over to the next week, even if employees work consecutive long shifts.

Example of Overtime Reset

If your company defines its workweek as Monday through Sunday, overtime starts after 40 hours during that week.

  • If an employee works 45 hours this week, the extra 5 hours are overtime.
  • When Monday comes again, the overtime counter resets — the next 40 hours will again be regular time.

Why Overtime Reset Matters for Payroll and Accounting

  • Accurate payroll calculations – Payroll systems must apply the overtime multiplier only to hours exceeding 40 in each workweek.
  • Compliance – Federal and most state labor laws require employers to define and consistently apply their workweek.
  • Audit trail – Clear overtime tracking helps prevent wage-and-hour disputes.
  • Cost control – Knowing when overtime resets allows managers to plan schedules and control labor costs.

Federal vs. State Overtime Reset Rules

While the FLSA defines the 7-day workweek rule, some states have stricter laws:

  • California – Overtime resets daily after 8 hours of work, not just weekly.
  • Alaska, Nevada, Colorado – Also have daily overtime thresholds.

Employers must always follow the rule that gives employees the greater benefit.

How to Set Your Overtime Reset Period

  • Define a fixed 7-day workweek (e.g., Sunday–Saturday or Monday–Sunday).
  • Keep it consistent for all pay periods.
  • Document it in your payroll and HR systems.
  • Update schedules or payroll software if company operations change.

Common Mistakes to Avoid

  • Changing the workweek to reduce overtime liability (illegal under FLSA).
  • Failing to document when the workweek begins.
  • Mixing different reset periods across departments.

Related Tools and Resources

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