California Regular Rate of Pay Calculator
Understanding California's Regular Rate of Pay
In California, understanding your "regular rate of pay" is crucial, especially when it comes to calculating overtime wages. The regular rate of pay is not simply your hourly wage; it's a broader figure that includes most forms of compensation you receive for your work during a workweek.
What is Included in the Regular Rate of Pay?
- Hourly wages
- Salaries (if paid on a daily, weekly, or monthly basis)
- Commissions
- Piece-rate payments
- Bonuses (non-discretionary, meaning they are promised or announced in advance and tied to specific achievements or performance metrics)
- Shift differentials
- On-call pay
What is Typically Excluded?
- Discretionary bonuses (those not announced in advance and not tied to specific performance)
- Gifts from the employer
- Payments made to an employee on a holiday, sickness, or vacation, if it's not more than the amount the employee would have been paid for a normal workweek
- Certain other payments, like employer contributions to health insurance or retirement plans.
Why is it Important?
California law requires that overtime be paid at a rate of "one and one-half times" the employee's regular rate of pay for all hours worked over eight in a workday and for the first eight hours worked on the seventh consecutive day of a workweek. For hours worked over 12 in a workday and for all hours worked over eight on the seventh consecutive day of a workweek, the overtime rate is double the regular rate of pay.
How to Calculate Your Regular Rate of Pay:
The basic formula for calculating your regular rate of pay for a given workweek is:
Regular Rate of Pay = Total Compensation for the Workweek / Total Hours Worked in the Workweek
Where "Total Compensation" includes all non-excluded wages earned during that workweek, and "Total Hours Worked" includes all hours worked, including overtime hours.
This calculator helps you determine your regular rate of pay based on the total wages you've earned and the total hours you've worked in a specific period. This figure is then used to ensure you are being paid correctly for any overtime hours.
Example Calculation:
Let's say an employee earned a total of $1,200.50 in a workweek and worked a total of 45 hours. This includes their hourly pay and a non-discretionary production bonus of $150.50.
- Total Wages Earned: $1,200.50
- Total Hours Worked: 45.0
Using the formula:
Regular Rate of Pay = $1,200.50 / 45.0 hours = $26.68 (approximately)
This $26.68 would then be used to calculate overtime. For example, overtime for the first 8 hours of overtime would be $26.68 * 1.5 = $40.02 per hour.