Wage FAQs Department of Labor and Industry Commonwealth of Pennsylvania

Now it’s time to put the full overtime pay formula to work by adding the base pay and overtime pay to get the total pay owed to your employee. From the example above, the base pay was $800 and the overtime pay was $375. One that’s easy to miss—but can be costly—is failing to pay overtime correctly. Figuring out how to calculate overtime pay all boils down to the state you’re in. If you are paid by the hour, you can calculate your time and a half rate by multiplying your hourly rate by 1.5. A tipped employee is someone who performs work that customarily and regularly receives more than $135 a month in tips.

How do I calculate time and a half?

• When Jane gets time and a half, her hourly rate increases to $18 per hour (12 x 1.5) for the extra hours she works.
• When it comes to holiday pay, there isn’t any federal legislation governing it.
• If an employee works more than 40 hours in a workweek they must be paid 1.5 times their base rate for all hours worked beyond 40 hours.
• You’ll use simple multiplication to figure out the overtime pay for an employee.
• Calculate overtime hourly pay rates given normal or standard pay rate.
• Overtime pay is the extra money you earn for working beyond your regularly scheduled working hours.

The employee is owed $2,062.50 for that week of pay including their $1,000 weekly salary, $500 in commissions, and $562.50 overtime pay. Yes, employers are able to dictate the time of day and hours employees work with the exception of Act 102 Prohibition of Excessive Overtime in Health Care Act. Act 102 states that except for circumstances addressed in the law, direct care workers cannot be required to work in excess of an agreed to, predetermined and regularly scheduled daily work shift. Your employer must give you a pay-stub each pay period which explains how long you worked, how much money you earned and how much money you were paid. The stub must include the number of hours you actually worked; your rate of pay; your gross wages; your deductions for taxes; and other deductions you have authorized your employer to make. The pay-stub also has to state the beginning and ending dates of the pay period.

Are Salaried Employees Entitled to Overtime?

A summary of these regulations can be found below or by accessing our Updated Regulations Presentation. The Minimum Wage Act Regulations can be found on the Pennsylvania Bulletin website at 34 Pa. Some employees might work different shifts with different rates of pay—or they might even have two different positions with two different rates. According to the Department of Labor, employees who make over $43,888 per year (effective July 1, 2024) or $58,656 (effective Jan. 1, 2025) are exempt from overtime. Yes, federal regulations allow up to 10 percent of what is overtime for 18 an hour the salary threshold can be satisfied by nondiscretionary bonuses, incentives, and commissions paid on an annual basis.

• The employee is owed $1,375 for that week of pay including their $1,000 weekly salary plus $375 in overtime pay for the ten hours of overtime they worked.
• It includes the employee’s normal hourly wage plus any additional amounts paid to the employee above and beyond their normal hourly wage.
• Compensatory time off in place of payment for overtime is not legal.
• To calculate overtime for a salaried employee, you must take the annual hours worked, 2,080 hours, and divide the income by it to get an hourly rate.
• You must give written authorization to your employer to make such non-tax related deductions.
• Overtime pay is often 1.5 times the regular rate of pay, known as time-and-a-half.

When can an employer take the tip credit deduction from employees’ base wages?

Varone is the author of two books, “Legal Considerations for Fire and Emergency Services” and “Fire Officer’s Legal Handbook,” and remains active as a deputy chief in Exeter, RI. All remunerations must be considered during the week that the remuneration is paid. Remember that getting more overtime should be balanced with personal well-being and maintaining a healthy work-life balance. Let’s take a look at what the overtime entitlements are in the accounting U.S. and how they can vary by state…

The federal government has not introduced any legislature on the subject of holiday pay. If you work Saturdays, Sundays, or holidays, you’re not legallyentitled to any special pay. Despite the lack of any legal requirement, holiday pay is commonly offered by most employers, to incentivize workers and keepthem happy.

• The handling of days on which some but not all meals are provided would need to be addressed.
• ​The regular rate for salaried employees who are not exempt from overtime is all remuneration paid to the employee divided by 40 hours.
• You’ll often get a “time and a half” rate when you work standard overtime, which means your pay rate is 1.5times your regular hourly wage.
• There may be additional requirements for certain persons within the City of Philadelphia.

​No, this updated regulation will not change Bookkeeping for Veterinarians overtime pay calculations for hourly employees. Under Pennsylvania law, an employer must pay for travel time if an employee is required to report to the employer’s establishment to clock in, load up, etc. If an employee leaves directly from home to the job site or vice versa it is not paid time. To add to the confusion, things are different in Massachusetts and Rhode Island, the only two states that oblige private employers to give paid time off onfederal holidays.

However, such a process will likely still prove easier to accomplish than the alternative of tracking meals receipts every day for each employee and reimbursing for the actual expense incurred. There are exceptions to the above general rule that all payments that are made to an employee must be included in that person’s regular rate. The exception that’s applicable to the question of the person who reached out to me pertains to expense reimbursements. If an employee works more than 40 hours in a workweek they must be paid 1.5 times their base rate for all hours worked beyond 40 hours. Yes, as long as you are given prior notice of the change prior to when it takes effect and the rate of pay does not fall below the minimum wage. It may be best practice to announce a change a pay period before.

Examples of Overtime Pay Calculations for Employees Who Work a Fluctuating Work Week

In retail, employees require a police permit and state approval to work on Christmas, Columbus Day,Thanksgiving, and Veteran’s Day. No permit is required to work on New Year’s Day, Labor Day, Memorial Day, or Columbus Day, but workers must be paidtime and a half. However, retail workers have the right to refuse to work these holidays. You will multiply that by 40 hours—assuming you are in a state that requires overtime based on hours worked in a week—as opposed to hours worked in a day. From the example above, an employee earning $25 an hour would have a base weekly pay of $800 ($25 an hour x 40 hours).