A tool that computes the correct hourly rate when an employee works multiple jobs, each with a different pay rate, during a single workweek and exceeds the standard 40-hour workweek threshold, necessitating overtime compensation. For example, an individual might work 30 hours at a rate of $20 per hour and 15 hours at a rate of $25 per hour in a single workweek. This requires calculating a weighted average of the different rates to determine the proper overtime compensation.
This calculation method ensures employees are fairly compensated for their overtime hours when performing multiple roles within the same company. Its importance stems from adhering to labor laws, preventing wage disputes, and fostering employee satisfaction. Historically, manual calculations of this nature were prone to errors and time-consuming, leading to the development and adoption of automated methods for increased accuracy and efficiency.
