Bonuses or Commissions Covering More Than One Workweek The earnings for all rates for the week are added together, and this total is then divided by the total number of hours worked for the week at all different jobs. Multiples Rates of Pay Within a Workweekįor hourly employees working at two or more rates during a single workweek for two or more different types of work, the regular rate of pay for that workweek is computed by taking the weighted average of such rates. While the amount of liability is small, there is no de minimis exception for an employer’s obligation to pay wages owed. An employer’s use of the common method for calculating overtime would not pass a DOL audit and would result in back wages owed to the employee. Under this scenario, the “common” and FLSA methods of calculating overtime reach the same result. In the case of double time pay, the ‘.5’ would replaced with a ‘1’Įmployee has a regular hourly rate of $8.00 and worked 46 hours in the workweek Step 4: Total pay for workweek + premium pay for overtime = total weekly compensation.5 x hours of overtime = premium pay for overtime Step 2: Regular pay divided by hours worked = regular rate of pay.Step 1: Total pay for workweek – exclusions = regular pay.Step-by-Step Example of Regular Rate of Pay Calculation: To calculate overtime, salaried employees’ total remuneration (excluding certain categories as provided by law) in a workweek is divided by the total number of hours actually worked in the workweek to calculate the number of overtime hours to be paid at the one and a half wage rate. The regular rate of pay is an hourly rate, minimum wage for example, and overtime must be computed on an hourly basis. The Formula for Calculating the Overtime Rate for Hourly Employees Overtime rules also make clear that payments that are an exemption in calculating the regular rate include expense reimbursement payments, premium payments for overtime work or the true premiums paid for work on Saturdays, Sundays, and holidays, discretionary bonuses, gifts and payments in the nature of gifts on special occasions, and payments for occasional periods when no work is performed due to vacation, holidays, or illness. Shift differentials, non-discretionary bonuses (bonuses promised to employees before the work begins), promotional bonuses, and cost of living adjustments bonuses are some of the payments that must be included in calculating the “regular” rate. The regular rate of pay includes all remuneration for employment except certain payments excluded by the Act itself. There is some confusion, however, as to how this apparently simple formula should be calculated under the wage and hour laws and how it relates to key labor laws. The Fair Labor Standards Act (“FLSA”) as enforced by the US Department of Labor requires that overtime pay be paid at a rate of not less than one and one-half times an employee’s regular hourly wage rate of pay after 40 hours of work in a workweek. #Over time calc how to#How to Calculate Overtime Pay Under the FLSA
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |