Calculating Overtime With Two Different Pay Rates Basic Wages And Overtime

The fair labor standards act flsa requires covered employers to pay nonexempt employees overtime pay for all hours worked over 40 in a workweek.

Half price oysters near me. This is a perfectly acceptable practice as long as the employee is actually performing two or more different types of work and the employer is not using multiple job rates to avoid compliance with overtime regulations. In the situation of an employee who works two different jobs at two different rates of pay the flsa allows two different methods of computing the regular rate for overtime calculation purposes. This can get tricky however when the employee performs two or more different jobs each with different pay rates.

Lets break it down together using an example. A workweek consists of seven consecutive 24 hour periods that equal 168 total hours and can differ from the pay period. The default method.

Averaging of hours over two or more weeks is not permitted. For employees perform work at different rates the flsa requires overtime to be calculated according to a blended rate or a rate not less than one and one half times the weighted average of all the different rates used during that workweek. Non exempt employees working more than 40 hours in a workweek must be paid an overtime rate.

When you pay an employee two rates of pay calculating overtime pay can be a conundrum. Normally overtime pay earned in a particular workweek must be paid on the regular pay day for the pay period in which the wages were earned. The regular rate of pay cannot be less than the minimum.

When an employee has multiple pay rates in a pay period the calculation of overtime can become more difficult. By default we use the higher of the two rates regular hourly 2 as the base rate for overtime and double overtime calculations. The employee thinks you should calculate it at the higher rate.

1240 x 05 620. How to calculate a blended weighted average overtime rate. 1 the weighted average and 2 the regular rate associated with the job that caused the overtime to occur.

Yes blended overtime is often referred to as weighted or weighted average. Typically the overtime rate is easy to calculate by taking the employees regular hourly rate and multiplying by 15. Take the employees weighted average pay rate and multiply it by 05 to get their weighted overtime rate.

Top ten tips disclaimer. Employees working at two or more rates. It gets its name because a weighted average of two different pay rates is used to determine the overtime rate.

Now multiply the employees overtime rate by the number of overtime hours worked 10 to get their total overtime wages. Joe drives 3 hours each day to and from a job site. Calculate the straight rate of pay.

For example if you enter 30 hours worked at a regular rate of 10 an hour 10 hours worked at an hourly 2 rate of 12 an hour and 10 hours overtime we calculate gross wages of 60000. Employers often pay overtime to a two rate employee based on the higher of the two rates to cover their bases. 620 x 10 62.

You can follow these steps for calculating overtime with two different pay rates.