 In this presentation we will calculate regular and overtime pay for an hourly worker. We'll start off with the calculation of regular pay which is pretty straightforward as long as we know what how many hours were worked and what the rate is. Note however that to know the hours worked for regular pay we do need to know what the overtime rules are and how to calculate what is regular pay versus overtime pay. For example if an employee is subject to overtime and they're an hourly worker we typically have the federal rule that we have to have anything over 40 hours in a work week would then be overtime so if somebody worked 43 hours in a work week then 40 of them would be regular three of them would be overtime. It's possible for states to have more stringent rules such as daily requirements like a eight hour a day work day anything over eight hours being overtime as well so we in that case would need to be able to calculate the daily wages and subject to see what would be overtime. This does get a little bit more complicated because if we're semi monthly or bi weekly or monthly payers or process our payroll in those time frames rather than just weekly then we still we still need to go back and check the weekly totals and make sure that we are in compliance with the overtime and paying the proper amount for overtime and if we're subject to daily totals and then we need to go back and make sure that we're picking up any kind of overtime that would be calculated for for that as well. Once we know the hours then it would be in this case 40 hours in the work week just multiplying at times the pay rate which would be whatever would be agreed upon in the terms of employment in this case 17 and 40 times 17 in this case would be 680 for regular pay. Then we've got the overtime pay now the overtime pay we first need to know what the overtime pay rate will be typically it's going to be time and a half it's often called time and a half let's try to break down what that actually means though and we'll see three different calculations we can use to do this this is a very common calculation in daily life as well so it's important to just understand what this means so if we if we had a regular pay of 17 time and a half basically means we're going to get a 50% raise it's kind of equivalent to getting the raise of 50% or 0.5 for any hours that are overtime that means that we got an $8 and 50 cent raise on this case which is 17 times 0.5 or 50 percent means that we have an $8 and 50 cent basically raise if we add that to our original 17 that means that our overtime rate is $25 and 50 cents this is a similar calculation if we were to calculate say a tip or something like that and it would be a you know a 50% tip but it would be 17 and then we have 50% we're adding another 850 on it to it and then we have to add the original amount to get to the total dollar that we're going to pay now we could do this a little bit more quickly we could say that the $17 is the original pay and just multiply it times 1.5 time and a half time and a half time 100% and a half another 50% so that's really what we kind of mean by time and a half it's 1.5 150% which means that we're going to multiply one which results in 17 and 50 which is the other component which will give us the 25 50 now one last way so this would be the faster calculation we want to calculate a tip if we had a 20% tip or something instead of multiplying times 0.2 or 20% then adding the original we could just say times 1.2 and that would give us the the amount we need to actually pay so then if we do this again we've got the regular pay of 17 and we multiply it then 150% which is just 1.5 times you know we'll put to a percent move the decimal two places over in other words if you had 1.5 times 100 it would be 150 or move the decimal two places over 150% just another way to say that same thing so that's what we mean when we multiply the overtime rate once we have that overtime rate then it's pretty straightforward to do the overtime calculation so again this is kind of the way we might if we were just to kind of make up the what is overtime buyer without thinking about it too much we'd probably come up with this longer calculation and then we can trim it down to something like this or just another representation like this okay so then we're going to go to the payroll register and we'll actually calculate the overtime in this case notes we've already filled out the regular pay which was 40 hours at 17 which gives us the 680 then we're saying there's three hours overtime there's 43 total hours 40 of them regular three hours overtime and the overtime rate then we're saying is going to be that 25 so the total pay is going to be this 76 which would be the three hours times 25.5 rate or 76.5 off the payroll end simulation end the simulation