Overtime for a tech on two rates: 4 steps to work it out

• total the workweek hours before any rate math, since the Oregon guidance says you should get overtime pay when the workweek is more than 40 hours, according to Oregon Bureau of Labor and Industries.
• weight the rate by dividing total straight-time pay by total hours, which gives $19.30 in the Oregon example, according to Oregon Bureau of Labor and Industries.
• under the Oregon example, add .5 times the average on overtime hours, not the full rate, because straight time was already paid, according to Oregon Bureau of Labor and Industries.
• keep the straight-time, weighted-rate and half-time extra lines separate so each amount can be traced back.

A tech's hours from every job in the week count toward the same overtime test. Add up all of them before deciding whether overtime is due. Use one workweek start date and end date on each time sheet so the hours fall into a single window. Use the same window for every tech so the totals can be compared across the team.

The Oregon example also gives a single-rate figure: "If you make $18.00 per hour, your overtime rate is $27.00 per hour," according to Oregon Bureau of Labor and Industries. Keep that figure apart from the half-time extra covered in the fourth step below. The two calculations answer different questions, and mixing them up will overstate the amount owed on the record.

A tech with two rates has two pay lines in the same week, and those lines should not be averaged by eye. Pull each job's hours and rate from the job log rather than from memory, because one wrong rate changes every figure after it. Write the two rates side by side at the top of the time sheet. Note which jobs were paid at which rate, so a later reviewer can follow the split without asking the tech to explain it.

The Oregon figures come from Oregon's own labor bureau, so check whether your state publishes its own rule before you rely on them. The Maryland Department of Labor has a page on its own minimum wage and overtime law, according to Maryland Department of Labor. Find your state's labor agency page and read its overtime rule before running payroll with these steps. Save that link with the payroll file so the rule you used can be found later.

Start by listing every hour the tech worked during the workweek, across every job and both rates. Write each job's date, hours, and hourly rate on its own line, so that no hour disappears when the week is totaled. Keep the whole week on one page, so the total covers the same span for every job. A list that is complete at this stage saves rework in the later steps.

Add a running total at the bottom of the list as each job is written. Check that running total against the time clock or the job log before moving on, because one missed job changes the total. Mark the hours that go past the 40-hour line in a separate column, so the overtime hours are visible at a glance. Keep a subtotal for each rate as well, since each subtotal is needed in the next step.

Do this total for every tech who worked more than one rate in the week, not only the ones you suspect had a busy week. Compare the workweek total with the 40-hour line before any money is calculated. If the total is not more than 40, there are no overtime hours to price for that week. If it is more than 40, carry the overtime hours forward to the pay steps and write the total on the time sheet.

Watch for hours logged under the wrong rate, especially when a tech moves from one job to another paid at a different rate in the middle of the week. Re-check the job log for those entries, because a wrong rate changes the weighted average in the third step. Correct the error on the sheet itself, not only in the payroll total. Save the corrected sheet with a short note explaining the change, so the record shows what was altered and why.

Enter the total hours and the overtime hours on the payroll sheet before any rate is applied. Those two inputs are the basis for every amount in the rest of this process. Stop once the hours are listed and totaled, since the pay math begins in the next step. For the fields to record with each total, see Record 7 hour fields before you approve today's time.

Multiply the hours at each rate by that rate, and write the result beside the hours. This produces straight-time pay for each rate with no overtime premium added yet. Do this for each job separately before combining anything, so each rate's pay can be checked on its own. Use the same rounding rule for every line on the sheet, so the sums match when you total them.

The Oregon example reads, "EXAMPLE: If an employee worked 16 hours at $18.00 per hour and 30 hours at $20.00 per hour the total straight time amount earned is $888.00," according to Oregon Bureau of Labor and Industries. Copy that layout as a model for your own sheet, with one line for each rate and a total line beneath them. The layout matters because it shows exactly which hours produced which pay.

Check the hours and rates on each line against the job log before you total them. A wrong rate at this point carries straight into the weighted average and then into the overtime amount. If a line looks unusual, go back to the job record rather than adjusting the number on the sheet. Accuracy at this step saves a correction later.

Keep the total straight-time pay as its own line on the payroll record, labeled as straight time. That label keeps it separate from the overtime extra, which comes later. Do not add any overtime premium at this stage, because the premium depends on the weighted average built in the third step.

Compare your layout against the example's layout rather than its dollar figures, because your tech's hours and rates will differ. A clear layout makes it easier for a second person to verify the total. Finish each rate's pay before averaging anything, so every line can be traced back to a single job.

Divide the total straight-time pay by the total hours for the workweek. This produces one average hourly rate that covers both rates. Use the total hours from the first step rather than the hours at one rate, because the average needs every hour in the denominator. Round only at the end, so the earlier lines stay exact.

The Oregon example says, "That amount is divided by total hours-worked (46), and the weighted average hourly rate is $19.30," according to Oregon Bureau of Labor and Industries. Notice that the example divides the straight-time amount, not the hourly rates added together. That order is what makes the average reflect the actual hours at each rate.

Check your division by multiplying the average back by total hours and comparing the result with the straight-time total. If the two figures do not match, look for a mistake in the hours, the rates or the division before going further. This check takes little time and catches the most common errors at this stage.

Keep the average on the sheet beside the total hours and the total straight-time pay. Write it with cents, since the Oregon figure is shown to the cent. Use the same average for every overtime hour in that week, so the half-time extra in the next step is calculated from one number.

Do this step for every tech who worked more than one rate in the same week. A tech with a single rate has no blend to compute, because the hours and the pay already share one rate. Mark the averaged weeks on the sheet so a later reviewer knows which records needed a weighted average.

Take the weighted average from the third step and multiply it by .5. In the Oregon example, this gives the extra half-time added on each overtime hour. Then multiply that result by the number of overtime hours in the workweek. Write the overtime hours on their own line, so this step has a clear input from the first step.

The Oregon example states, "Since the employer has already paid the straight time rates for all hours worked, only an additional .5 times the average hourly rate is due for the overtime hours (.5 x $19.30 x 6 hours = $57.90)," according to Oregon Bureau of Labor and Industries. Read the quoted sentence as the method for the half-time extra, not as a general rule for every workplace.

Your sheet should show the straight-time pay already recorded in the second step, with the half-time extra added on a separate line beneath it. Keeping the lines apart shows that straight time was not paid twice. Label the extra as an overtime premium so a reviewer can see what it is.

Compare each overtime line with the overtime hours from the first step. If the hours do not match, go back to the first step before paying anything. A mismatch here usually traces back to an incomplete list of hours, so check the list first.

Add the straight-time total from the second step and the half-time extra from this step to reach the full amount for the week. Pay that combined amount, and keep both lines on the record. Use the Oregon figures as a model for the method only, since the dollar amounts belong to that example and not to your tech.

Keep the time sheet with each job's date, hours and rate, so every figure can be traced back to its source. The Oregon guidance says, "Payroll records must reflect overtime pay of 1.5 times that rate for hours over 40 in a workweek," according to Oregon Bureau of Labor and Industries. Build the record so the overtime line can be checked against that wording. For a companion checklist, see Calculate technician overtime with 8 payroll fields.

Keep the straight-time totals, the weighted average and the half-time extra as separate labeled lines. Each line should show its input, so a reader can rebuild the amount without the original calculation. A record that shows only the final total makes errors hard to find and hard to explain.

Save a corrected version whenever a time entry changes, and write the reason and date of the change beside it. Keep the earlier version as well, so the change history is visible. A short note is enough, as long as it names what changed and who made the change.

Store the workweek dates and the tech's name on each record. Keep one folder for each workweek so the overtime test is tied to a clear span of days. This page is editorial guidance and not legal or payroll advice, so confirm any rule with your state's labor agency before you rely on it.

The table below lists the quoted wording from each cited publisher.

• field service work order checklist
• emergency action plan for a new tech

Your next step is to pull last week's time sheet for any tech with two rates and run the steps above to check what was paid.

When is overtime owed in a workweek?

The Oregon bureau sets the trigger at a workweek of more than 40 hours, according to Oregon Bureau of Labor and Industries. Hours from every job in that week count toward the same total. Check your own state's rule before you apply this trigger to your payroll.

How do I find a weighted average hourly rate?

Divide the total straight-time pay by the total hours for the workweek, which is the method the Oregon example uses, according to Oregon Bureau of Labor and Industries. Use the same method with your own totals and round only at the end.

Why is only .5 times the rate added for overtime hours?

Under the Oregon example, only .5 times the average is added because straight time was already paid for every hour worked, according to Oregon Bureau of Labor and Industries. Show the straight-time pay and the half-time extra on separate lines so nothing is paid twice.

Does this apply in every state?

Not necessarily: the Oregon example comes from that state's labor bureau, according to Oregon Bureau of Labor and Industries, so its figures describe that jurisdiction. The Maryland Department of Labor has a separate page on its own minimum wage and overtime law, according to Maryland Department of Labor. Check your state's labor agency before you run payroll.