Suppose
Sue, an office worker in Washington state, earns $15/hr, and works 55 hours in
a given week. Washington requires companies to pay workers at the rate of
"time and a half" if they work more than 40 hours in a given week.
How much will Sue make this week?
We
know she works 55 hours; the first 40 hours are calculated at her regular wage
of $15/hr, and the remaining 15 hours are calculated at the "time and a
half" wage, ie: one and a half times her usual $15/hr wage. We can pop
this into the calculator: 15 times 1.5 = $22.50. So for the final 15 hours of
her work week, Sue makes $22.50/hr.
So how
much does she make in total?
For
her first 40 hours, she makes $15/hr: that's 40 times 15, or $600.
For
the last 15 hours, she makes $22.50/hr: that's 15 times 22.50, or $337.50.
In
total, therefore, she makes $600 + $337.50, or $937.50.
Notice
how the last 15 hours, Sue made nearly two-thirds of the pay during her first
40 hours, so time-and-a-half really does pay off in Sue's case.
---
Let's
go through another example: suppose Bill works as a machinist and earns $20/hr.
If Bill pulls in a 65 hour work week while his company delivers a large order,
how much will he earn that week?
Note
that Bill works his first 40 hours at the rate of $20/hr, and the final 25
hours at the time-and-a-half rate, 1.5 times 20, or $30/hr.
So for
the first 40 hours, Bill makes 40 times 20 = $800.
And
for the next 25 hours, Bill makes 25 times 30 = $750.
So in
total, Bill makes $800+$750=$1550.
Again
- Bill makes nearly the same amount of pay in his 25 hours of overtime, as he
did during his 40 hours of regular time work. That's why employees love
overtime and bosses hate it!
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