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Overtime Pay: Non-Standard Workweeks
Employers are required to compensate their employees for overtime work at 1.5 times their regular rate of pay. For employees paid by the hour or employees paid with a salary intended to compensate for 40 hours per week, the calculation is relatively simple (please see Overtime Pay: How to Calculate for details). Calculating overtime pay for an employee whose salary is designed to compensate for more or less than 40 hours per week gets trickier.
Fixed Workweek (More than 40 Hours per Week)
If the salary is designed to compensate for more than 40 hours per week, overtime is compensated as follows:
- 0-40 hours = no overtime pay;
- 41 hours up to the number of hours the salary is designed to compensate for = 0.5 times the regular rate of pay; and
- Any hours over the number of hours the salary is designed to compensate for = 1.5 times the regular rate of pay.
For example, if a salary of $550 per week is designed to compensate for 55 hours per week, and the employee works 65 hours in a particular week:
- The standard rate of pay is $550 divided by 55 = $10 per hour.
- Overtime pay equals 0.5 times the standard rate of pay for hours 41-55 ($5 per hour x 15 hours = $75) plus5 times the standard rate of pay for hours 56-65 ($15 per hour times 10 hours = $150).
- Total overtime pay is $75 plus $150 = $225.
Fixed Workweek (Fewer than 40 Hours per Week)
In a fixed workweek in which the salary is intended to compensate for fewer than 40 hours per week, the regular rate of pay is the weekly salary divided by number of hours the salary was intended for compensate for, and the overtime rate of pay is 1.5 times that much. Overtime pay, however, still applies only to hours worked beyond 40.
For example, if the salary was intended to compensate for 25 hours per week and the weekly salary is $500, the standard rate of pay is $20/hour and the overtime rate of pay is $30/hour. If the employee works 50 hours in a week, the standard rate of pay still applies to the first 40 hours and overtime pay applies only to the last 10 hours.
An employee has a fluctuating workweek when his salary is designed to compensate for hours that fluctuate from week to week. The employee’s regular rate of pay for the purpose of calculating overtime varies from week to week – it equals the weekly salary divided by the number of hours actually worked. Overtime pay equals 0.5 times the employee’s regular rate of pay for that week times the number of hours worked over 40.
- If the employee’s weekly salary is $600 and he works 60 hours that week, his regular rate of pay for that week is $10 per hour.
- The overtime rate of pay for that week is 0.5 times $10/hour = $5/hour.
- Since the employee worked 20 hours of overtime, his overtime pay is $5/hour times 20 hours of overtime = $100 in overtime pay.
Call Zinda Law Group Now
If you are a party to an overtime pay dispute, the most important decision you make in your case might be who you retain as an attorney. Zinda Law Group is one of the most prominent and respected law firms in the Austin area, and we have been approved by the Better Business Bureau®. Many of our lawyers enjoy years of experience in employment law. We work ceaselessly to secure justice for our clients. If your dispute arose in greater Austin, or if the potential defendant is a located in Austin, telephone us immediately at 800-863-5312 for a free consultation.