About Overtime Calculation Methods
Select the method you want to use to calculate overtime. Choose from the following options:
- Hourly Rate Overtime is calculated based on the hourly rate.
- Minimum Wage. Overtime is based on the minimum wage stored in an employee's record.
- Shift Rate. Overtime is based on the shift rate.
- Regular Rate – Hourly. Overtime is based on a regular rate that is calculated by adding all the earnings included in the regular rate, and dividing by the total number of hours actually worked.
- Regular Rate – Salary Fixed Hours. Use this option to calculate overtime rates for salaried employees who work a fixed number of hours per week. The payroll program calculates the weekly equivalent salary that includes any earnings you have set to be included in regular rate overtime calculations.
- Regular Rate – Salary Fluctuating Hours. Use this option to calculate overtime for salaried employees who are paid weekly, and whose hours may change from week to week. If you select this option, payroll will divide the straight time compensation by the total hours actually worked to calculate the regular rate. The payroll program then overrides the rate multiplier in the overtime schedule and the overtime rate will automatically be half the regular rate. With this option, any earnings that you set to be included in the regular rate will be included in the overtime calculations.
For special cases where none of these options is appropriate, for example if you are paying a weekly employee bi-monthly, you can override the automatic overtime calculation chosen here when you complete the timecard.