Calculating gross pay with overtime
About this video
Alina earns $18 an hour as a non-exempt employee and gets 1.5 times her rate after 40 hours. Adding her daily hours gives 46 hours, so she earns 40 x $18 = $720 plus 6 x $27 = $162, for gross pay of $882.
You'll be able to
- find an overtime rate by multiplying the regular rate by 1.5.
- split weekly hours into regular and overtime hours.
- calculate gross pay including overtime.
Key words
- Gross pay
- Total pay before any taxes or deductions are taken out.
- Non-exempt employee
- A worker who must be paid overtime when working over the limit.
- Overtime
- Hours beyond 40 a week, paid here at 1.5 times the regular rate.
Transcript
- [Speaker] We're told that Alina works as a receptionist at a fitness center. She earns $18 an hour as a non-exempt employee. The following table shows the hours she worked in a week. Alright, these are the hours she worked. Overtime applies after 40 hours at 1.5 times the regular rate.
What is Alina's gross pay for the week? So, pause this video and have a go at this. So, the key here is we know the hours, we know what she's normally making as an hourly employee, but we know that as a non-exempt employee that overtime is also going to apply to her.
So, what we wanna do is we wanna add up all of the hours she works. The first 40 hours, she would make it $18 an hour, and then anything above that, she would do 1.5 times 18. So, 18 times 1.5 is equal to what? 18 plus nine. That's equal to $27. So, that should be her overtime pay.
So, for the first 40 hours, $18 an hour, and then anything over that, it should be $27 an hour. So, let's get our calculator out and let's add up how many total hours she worked in that week. So, we have a 7.5 plus eight, plus 8.5, plus nine, plus eight, plus five, and then zero.
So, she worked a total of 46 hours. So, that means she should be making $18 an hour for 40 of those hours, and then for the remaining six, she should be making $27 an hour. So, let's figure out what that is. And I'll just remember that in my head, there's 40 hours at 18 and then six hours at $27 an hour.
So, if we do 40 hours times $18 an hour, that's $720. And then plus, and then let me open up a parentheses. We had a surplus or overtime six hours, times $27 an hour. That's 1.5 times her regular hourly wage. And so that's going to be that. And then you add it all together.
Her gross pay for the week should be $882. 882, and we're done.
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