Employee Working at Two or More Rates

Reference Number: MTAS-2096
Tennessee Code Annotated
Reviewed Date: October 03, 2019
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Computing Regular Rate of Pay - Employee Working at Two or More Rates
When, in a single workweek, an employee performs two or more different types of work for which different straight-time rates have been established, the employee’s regular rate for that week can be calculated as the weighted average of such rates. The weighted average is the earnings from all such rates added together, and the total is divided by the total number of hours worked at all jobs. 29 C.F.R. § 778.115.

Example: Employee works two jobs (Admin Asst and Janitor). Employee earns $15/hr as Admin Asst for 40 hours of work. The employee earns $9/hr as Janitor for 8 hours week. Total hours worked during workweek is 48. Under the weighted average method, earnings from the Admin. Asst position (40 X $15.00 =$600) is added to earning from the Janitor job (8 X $9.00 = 72.00) to get a total of $672.00. The total is divided by the total hours worked (48 hours) to arrive at the weighted average regular rate of pay of $14.00 per hours.

The earnings total of $672.00 represents the straight-time pay earned for the 48 hours worked, so only half-time pay for the 8 overtime hours is needed to assure that the required time and a half is paid for overtime hours worked. Half-time for the weighted average regular rate is $7.00 per hour ($14.00 ÷ 2), which must be multiplied by the 8 overtime hours ($7.00 x 8 = $56.00) and added to the straight-time pay to get the total pay for the workweek. Therefore, using the weighted average method, total pay for the workweek would be $728.00 (56.00 + $672.00).

 

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