FLSA Overtime FLSA Overtime on Premium Payon Premium Pay

Presented by:Presented by:Anita Gurule/Classified Pay Anita Gurule/Classified Pay

SpecialistSpecialistSue Hall/ Payroll AccountantSue Hall/ Payroll Accountant

Fair Labor Standards Act Fair Labor Standards Act (FLSA)(FLSA)

Requires that certain types of Requires that certain types of employee compensation must be employee compensation must be included in the calculation of included in the calculation of overtime.overtime.

Premium PayPremium Pay

What is Premium Pay?What is Premium Pay?

Special pay give to employees for working Special pay give to employees for working weekends, late shifts, or other duties requiring weekends, late shifts, or other duties requiring additional compensation.additional compensation.

Pay: (Such as)Pay: (Such as) Shift Differential, Confined Space, Electrician, Shift Differential, Confined Space, Electrician,

Diving, High Work, Nuclear Reactor Diving, High Work, Nuclear Reactor Licensing, and Hazard Material. Licensing, and Hazard Material.

When and why is When and why is Overtime on Premium Overtime on Premium

Pay Calculated?Pay Calculated? Overtime is 1 ½ times the regular Overtime is 1 ½ times the regular

rate of pay. The calculation of rate of pay. The calculation of regular rate is different when regular rate is different when premium pay is included.premium pay is included.

This only applies to FLSA overtime This only applies to FLSA overtime hours, which is time worked in hours, which is time worked in excess of 40 hrs per week.excess of 40 hrs per week.

How Much Should Be How Much Should Be Paid?Paid?

There are two methods you can use There are two methods you can use when calculating overtime on when calculating overtime on premium pay.premium pay.o Coefficient Table (is prepared by U.S. Coefficient Table (is prepared by U.S.

Department of Labor and is the most Department of Labor and is the most highly recommended method)highly recommended method)

o Formula MethodFormula Method

Example TimesheetExample Timesheet

Does employee have overtime?Does employee have overtime?

Did the employee earn differential Did the employee earn differential pay during FLSA overtime? (Hours pay during FLSA overtime? (Hours over 40)over 40)

Week 2 CalculationWeek 2 Calculation Employee worked 11 DSH. So amount of Employee worked 11 DSH. So amount of

differential earned is:differential earned is: ( 11 X .75= $8.25)( 11 X .75= $8.25)

Employee worked 52.75 hrs that week, so Employee worked 52.75 hrs that week, so we will need the coefficient for 52.75.we will need the coefficient for 52.75.

Go to Coefficient Table:Go to Coefficient Table:

FLSA Hours

Even 0.25 0.50 0.75 0.10 0.20

49 .092 .094 .096 .098 .0927 .0935

50 .10 .102 .104 .106 .1008 .1016

51 .108 .110 .112 .114 .1086 .1094

52 .115 .117 .119 .121 .1161 .119

Amount Owed For Week Amount Owed For Week 22

Multiply $8.25 by .121 to get amount owed.Multiply $8.25 by .121 to get amount owed. $1.00 additional is owed to employee for $1.00 additional is owed to employee for

overtime on premium pay (.998 is rounded up)overtime on premium pay (.998 is rounded up) During time entry you would enter the OTM, During time entry you would enter the OTM,

DSH, plus:DSH, plus:

Earn CodeEarn Code UnitsUnits Special RateSpecial Rate

OTDOTD 11 $1.00$1.00

Week 3 CalculationWeek 3 Calculation Employee worked 19 DSH. So amount of Employee worked 19 DSH. So amount of

differential earned is:differential earned is: ( 19 X .75= $14.25)( 19 X .75= $14.25)

Employee worked 59 hrs that week, so we Employee worked 59 hrs that week, so we will need the coefficient for 59.will need the coefficient for 59.

Go to Coefficient Table:Go to Coefficient Table:

FLSA Hours

Even 0.25 0.50 0.75 0.10 0.20

57 .149 .151 .152 .154 .1497 .1503

58 .155 .157 .158 .16 .1558 .1564

59 .161 .162 .164 .165 .1616 .1622

60 .167 .168 .169 .171 .1672 .1678

Amount Owed For Week Amount Owed For Week 33

Multiply $14.25 by .161 to get amount owed.Multiply $14.25 by .161 to get amount owed. $2.29 additional is owed to employee for $2.29 additional is owed to employee for

overtime on premium payovertime on premium pay

( In this case the employee has two weeks of ( In this case the employee has two weeks of OTD owed. You would enter the total amount OTD owed. You would enter the total amount of OTD owed for the whole month.)of OTD owed for the whole month.)

You would enter :You would enter :

Earn CodeEarn Code UnitsUnits Special Special RateRate

OTDOTD 11 $3.29 ($1.00+ $2.29)$3.29 ($1.00+ $2.29)

Formula MethodFormula Method

Total Premium Pay EarningsTotal Premium Pay Earnings FLSA FLSA OT HoursOT Hours

Total # of Hours WorkedTotal # of Hours Worked 22

Week 2 Computation Week 2 Computation With Formula MethodWith Formula Method

Total Premium Pay Earnings Total Premium Pay Earnings X X FLSA OT HoursFLSA OT Hours

Total # of Hours WorkedTotal # of Hours Worked 22

$8.25$8.25 X X 12.7512.75 =1.00 =1.00

52.75 52.75 2 2

You would enter:You would enter:

Earn CodeEarn Code UnitsUnits Special Special RateRate

OTDOTD 11 $1.00$1.00

Co-efficient Table Co-efficient Table RecommendedRecommended

Why?Why? Less chance of ErrorLess chance of Error More accurateMore accurate Saves timeSaves time More convenient (available online)More convenient (available online)

Online linkOnline link

Information, examples, and the co-Information, examples, and the co-efficient table is available online efficient table is available online under “Computing FLSA Overtime under “Computing FLSA Overtime on Premium Pay” at:on Premium Pay” at:

http://oregonstate.edu/dept/budgets/PAYManual/http://oregonstate.edu/dept/budgets/PAYManual/PAY501.htmPAY501.htm

Questions?Questions?