Many employees are wondering how their overtime pay is computed. It is important that you understand the California Overtime Law so that you are paid properly. Under the law, overtime pay is given for every hour worked beyond the regular 8 hours each workday, or for work rendered over 40 hours in one workweek. The overtime pay can either be calculated on a weekly or daily basis. Here is how your overtime is computed:
1. Determine your regular hourly wage. If you are paid on an hourly basis, that is your hourly rate. However, if you are receiving a fixed salary or are paid with combination of commission, piecework, or salary, you should follow this formula. Determine the total pre-tax annual salary, divide it by 52 and then divide by 40 again. That number will be your hourly rate. If you are paid by a different terms, you can consult a California Wage Law Attorney to determine how much your hourly rate as well as your overtime pay is.
2. Compute how many hours you rendered over that given workweek. Subtract 40 from the total number of hours worked, the result is the overtime worked for that workweek. Under California Overtime Law, employers are required to pay any hour worked over 40 in a workweek at a rate of 1.5 times the regular hourly rate. For work rendered after 12 hours a day, the pay should be at 2 times the regular rate.
3. In case the number of work hours for the week is less than 40, the employer is still required to pay overtime on a daily basis. The overtime hours will be computed based on total the number of hours worked for the day minus 8 hours.
If you are finding a hard time computing your overtime pay and you believe your employer is not paying you properly, you can seek the help of a California Wage Law Attorney. He or she will be able to clearly discuss with you how overtime is computed.