We have non-exempt hourly employees who work in different job positions at different rates of pay. If they work OT, we currently pay them straight pay at the different rates, and pay them the OT rate of which ever job they are doing after they reach the 40 hours. I have read some DOL interpretations which state that we have to calculate their pay based on the blended rate method. Is this true, or is it ok to continue paying them as we have been doing?

Thanks!

I have read some DOL interpretations which state that we have to calculate their pay based on the blended rate method. Is this true Yep.

or is it ok to continue paying them as we have been doing? Nope.

You must calculate any OT pay each week based on a weighted average.

Beth- thank you so much for your speedy response. I was wondering if you knew where I could find that actual reg to present it to my agency. Because I found confirmation that it is ok to pay them at the OT rate for the job that they are doing after they hit the 40 hours, as long as it is agreed upon prior to the work being done. Here is a website that this information is presented:

http://www.ppspublishers.com/articles/FLSA_roundup.htm?c1=seo&source=pps&kw=flsa

Just because it's on the web doesn't mean it's correct. I had to research this very issue several years ago when we had an employee working two jobs at two different rates of pay. Rather than just send you off to wade through the FLSA, I suggest you give the federal Department of Labor a call. They have the final say on these matters. 202-693-4650.

Actually, there are some exceptions as follows:

The employee must agree in advance;

The average hourly earnings for the workweek (not including overtime pay and other earnings excluded from the regular rate) equal or exceed the minimum wage;

extra overtime pay is paid on other forms of earnings that are included in the regular rate, such as nondiscretionary bonuses;

the hourly rate used to determine the overtime rate equals or exceeds the minimum wage and is the rate actually paid for such work during nonovertime hours;

the hours of work for which overtime is paid qualify as overtime hours; and

the number of overtim hours is at least the number of hours worked in excess of the FLSA maximum (40 in a workweek).

This is addressed in the FLSA Wage and Hour regulation 29, CFR section 778.415-421.

Thank you for the clarification. I'm not sure if you can answer this or not, but do you know the reasoning for having the two different methods of calculation?

Got me. Ask Congress. :D