overtime calculations Archives - HR, Payroll, and Employee Management Tips for Small Business

Business Math: Calculating the Regular Rate for Overtime

Many businesses have employees that get paid multiple pay rates during their shift. This happens when they perform more than one specific job function. For those employees, the hourly rate depends on the job they are working on at the time. Hourly rates by job can vary when employees work in the construction, plumbing, caretaking, landscaping, and many other industries. When you have an employee that works under different rates, you need to make sure that you are calculating their regular pay rate properly for overtime. Unless your employee is specifically exempted, employees working at more than one job rate covered by the FLSA must receive overtime pay at their regular rate and not at the specific rate for the job they are doing when overtime is incurred.

5 Ways to Mess Up Overtime Calculations

Published by Peggy Emch

Employers can make a lot of mistakes with overtime calculations if they’re not careful and this is bad because it can lead to lawsuits. Some employers make some of these mistakes intentionally too and basically test their luck with labor lawsuits.

Some of those mistakes include: avoiding overtime payments by classifying employees incorrectly as contractors, paying employees a salary when they should be working by the hour, “paying” private employees comp-time in lieu of overtime, etc.

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How You Get Overtime On a Week With Under 40 Hours

Published by Peggy Emch

Occasionally, we hear from customers who want to know why an employee has overtime on the payroll report but does not appear to have overtime on the timecard. Under normal circumstances, the two would match but, given the right mix of conditions, they sometimes don’t. I’ll explain why that is and what you can do to avoid it.

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Business Math: Calculating Overtime By Hand

Published by Peggy Emch

Calculating overtime by hand can be risky. The Federal and State governments have set a lot of rules to ensure that employees get paid fairly for the time they work over 40 hours, and if a company doesn’t know and follow all of those rules, overtime lawsuits often result.

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Working at Multiple Companies For the Same Employer

Published by Peggy Emch

Employers who operate multiple companies don’t always realize that their employees who work for both must have their hours at each company combined for overtime calculations.

When employees work for two different companies owned by one employer (called joint employment), they are still entitled to overtime when their clocked hours at both companies exceed 40 in a week (or 8 in a day in some states).

“Joint employment exists when a person is employed by two or more employers such that the employers are responsible, both individually and jointly, for compliance with a statute.” – DOL

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Do Vacation Hours Count As Overtime?

Published by Peggy Emch

Do vacation hours count as overtime? This is a common question among employers and employees alike. If an employee takes 8 hours of vacation or PTO on a week where he works more than 32 hours in that week, will those hours over 40 be counted as overtime?

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Calculate Overtime After 40 Hours and Not After 80

Published by Peggy Emch

I have heard this question asked countless times over the years:

“Why does your time tracking system only calculate overtime after 40 hours and not after 80 hours?”

The answer is, because that is how it’s defined in the FLSA. Many business owners don’t realize this but they must calculate overtime after 40 hours and within one workweek, not after 80 hours within two. In other words, it’s not our design, it’s the law for most cases in the US.

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Tag: overtime calculations

Business Math: Calculating the Regular Rate for Overtime

5 Ways to Mess Up Overtime Calculations

How You Get Overtime On a Week With Under 40 Hours

Business Math: Calculating Overtime By Hand

Working at Multiple Companies For the Same Employer

Do Vacation Hours Count As Overtime?

Calculate Overtime After 40 Hours and Not After 80