If you work overtime in Texas, state law entitles you to overtime pay at the rate of 1.5 times your regular rate of pay. You may also choose to collect overtime pay in the form of compensatory time off, at the rate of 1.5 hours for each hour of overtime you worked.
If you chose to receive paid time off instead of actual pay, note that state law regulates how many credits you may accumulate. The Glen Hager Texas Comptroller of Public Accounts explains the rule regarding overtime credit accumulations.
The rule regarding credit accumulations
With few exceptions, Texas law states that employees may not accumulate more than 240 hours of overtime credit that they may take as compensatory leave. If you exceed the overtime credit amount, your employer must compensate you at 1.5 times your regular rate of pay for each hour of overtime that exceeds the 240-hour limit.
State law makes a few exceptions for the 240-hour limit rule. You may accumulate as much as 480 hours in overtime credit for compensatory leave purposes if you accrued overtime while performing a public safety activity, while engaging in a seasonal activity or while acting as a first responder.
Overtime credits and holiday or paid leave
If your employer offers paid leave or paid holidays off, you must be careful in how you use your holiday/paid leave and overtime credits. You cannot use any type of compensatory leave concurrently. Moreover, any holiday or paid leave time that you do use does not count as hours worked for the purposes of computing overtime hours.
Texas maintains strict overtime laws. If your employer violates them, even unwittingly, the law may entitle you to back pay.