Overtime Rate
Encyclopedia
Overtime rate can have different meanings in different countries and jurisdictions. In some countries there is no concept of a standard working week (or similar time period), and no bonus pay for exceeding a set number of hours within that week. In other countries, bonus pay is mandated for certain classes of workers when a set number of hours is exceeded.
In the United States a standard work week is considered to be 40 hours. Non-exempt workers (as defined by federal law) must be paid at a wage rate of 150% of their regular hourly rate for hours that exceed 40 in a week. Note that the start of the pay week can be defined by the employer, and need not be a standard calendar week start (e.g. Sunday midnight). Many employees, especially shift workers in the US have some amount of overtime built into their schedules so that 24/7 coverage can be obtained.
The overtime rate calculates the ratio
between employee overtime
with the regular hours in a specific time period. Even if the work is planned or scheduled, it can still be considered overtime if it exceeds what is considered the standard work week in that jurisdiction.
A high overtime rate is a good indicator of a temporary or permanent high workload
. It could result in a higher illness Rate, higher labor costs, and lower productivity.
In the United States a standard work week is considered to be 40 hours. Non-exempt workers (as defined by federal law) must be paid at a wage rate of 150% of their regular hourly rate for hours that exceed 40 in a week. Note that the start of the pay week can be defined by the employer, and need not be a standard calendar week start (e.g. Sunday midnight). Many employees, especially shift workers in the US have some amount of overtime built into their schedules so that 24/7 coverage can be obtained.
The overtime rate calculates the ratio
Ratio
In mathematics, a ratio is a relationship between two numbers of the same kind , usually expressed as "a to b" or a:b, sometimes expressed arithmetically as a dimensionless quotient of the two which explicitly indicates how many times the first number contains the second In mathematics, a ratio is...
between employee overtime
Overtime
Overtime is the amount of time someone works beyond normal working hours. Normal hours may be determined in several ways:*by custom ,*by practices of a given trade or profession,*by legislation,...
with the regular hours in a specific time period. Even if the work is planned or scheduled, it can still be considered overtime if it exceeds what is considered the standard work week in that jurisdiction.
A high overtime rate is a good indicator of a temporary or permanent high workload
Workload
-An amount of labor:While a precise definition of a workload is elusive, a commonly accepted definition is the hypothetical relationship between a group or individual human operator and task demands....
. It could result in a higher illness Rate, higher labor costs, and lower productivity.
Calculation Formula
- Unit of Measure: %