Sources & Methodology

Sources and Methodology

How our calculators work, where the rules come from, and how edge cases are handled.

Federal Overtime Rules (FLSA)

The baseline for all overtime calculations is the Fair Labor Standards Act. Under federal law, non-exempt employees must receive 1.5× their regular rate for all hours worked over 40 in a single workweek. Our calculator applies this rule as the default for all states.

Source: U.S. Department of Labor, Wage and Hour Division — Overtime Pay (dol.gov/agencies/whd/overtime)

State-Specific Overtime Rules

Several states impose rules that go beyond the federal minimum. Our calculator accounts for these:

  • California: Daily overtime (1.5× after 8 hours/day, 2× after 12 hours/day), 7th consecutive day rule. Source: California Labor Code §510, IWC Wage Orders.
  • Nevada: Daily overtime (1.5× after 8 hours/day) applies only to employees earning below 1.5× the state minimum wage. Source: Nevada Revised Statutes §608.018.
  • Alaska: Daily overtime (1.5× after 8 hours/day) in addition to weekly overtime. Source: Alaska Statute §23.10.060.
  • Colorado: Daily overtime (1.5× after 12 hours/day or 12 consecutive hours). Source: Colorado COMPS Order #40.
  • All other states: Federal weekly-only rule applies unless otherwise noted.

Minimum Wage Figures

Minimum wage rates used in calculator logic and state pages are drawn from official state department of labor publications and verified annually. Rates shown reflect the most recently confirmed figures at the time of publication.

Sources: State department of labor websites, U.S. Department of Labor minimum wage table (dol.gov/agencies/whd/minimum-wage/state).

Regular Rate of Pay — How It Works

The regular rate is the foundation of every overtime calculation. For a straightforward hourly worker it equals the hourly wage — but it is often more complex. Under 29 CFR Part 778, the regular rate must include:

  • Non-discretionary bonuses — production bonuses, attendance bonuses, shift differential payments, and any bonus the employee expects to receive based on a formula.
  • Commissions earned during the workweek.
  • Piece-rate earnings — the total piece-rate pay for the week divided by total hours worked gives the regular rate for that week.
  • On-call pay and reporting-time pay where applicable.

What is excluded from the regular rate: discretionary bonuses (a surprise holiday gift), gifts, vacation pay, overtime premiums already paid, and contributions to benefit plans.

Blended Rate Example

If an employee earns $800 base pay for 40 hours and a $100 non-discretionary bonus in the same week with 5 overtime hours, the regular rate is not simply $20/hr:

Total straight-time earnings = $800 + $100 = $900 Total hours worked = 45 Regular rate = $900 ÷ 45 = $20.00/hr Overtime premium = 0.5 × $20.00 × 5 OT hours = $50.00 Total pay = $900 + $50 = $950

Our calculator uses a single hourly rate for simplicity. Workers with bonuses, commissions, or multiple pay rates should calculate their blended regular rate manually before using the overtime result as a guide.

California Edge Cases

Daily vs. Weekly — No Double-Counting

California's daily and weekly overtime rules apply independently, but hours are not counted twice. If an employee works a 10-hour day (2 daily OT hours) and reaches 40 total hours by the end of the week, the 2 hours already counted as daily overtime are credited toward the weekly total — they are not added again as weekly overtime.

Rule: an hour compensated at the daily overtime rate does not also generate a separate weekly overtime premium for the same hour.

7th Consecutive Day Rule

If an employee works seven consecutive days in a single workweek (as the employer defines it), the first 8 hours on the 7th day are paid at 1.5×, and hours beyond 8 on the 7th day are paid at 2× — regardless of total weekly hours. An employee could trigger 7th-day premiums even if their total for the week is under 40 hours.

Alternative Workweek Schedules (AWS)

A California employer can adopt an alternative workweek schedule — such as four 10-hour shifts — through a two-thirds vote of affected employees and proper filing with the DLSE. Under a valid AWS:

  • Daily overtime does not begin until the employee exceeds the scheduled daily hours (e.g., 10 hours on a 4/10 schedule, not 8).
  • Hours beyond the scheduled daily maximum but not over 12 in a day are still paid at 1.5×.
  • Hours over 12 in any day, and hours over 8 on the 7th consecutive day, are still paid at 2×.
  • Hours over 40 in the week that are not already covered by daily overtime premiums are paid at 1.5×.

An AWS shifts when the daily clock starts — it does not suspend California overtime law. Improperly adopted schedules (missing the vote, wrong filing, etc.) are invalid, and the standard 8-hour daily rule applies.

Piece-Rate and Flat-Rate Workers in California

California requires that piece-rate employees be compensated separately for rest periods and non-productive time at an average piece-rate or the minimum wage, whichever is higher. This affects the regular rate used for overtime. Our calculator does not handle piece-rate scenarios — for those situations, refer to California Labor Code §226.2.

Tipped Worker Overtime

For tipped employees, the correct federal formula is:

Overtime cash rate = (1.5 × full applicable minimum wage) − tip credit

This is not 1.5× the cash wage. For example, if the state minimum wage is $13/hr and the tip credit is $3.02/hr:

(1.5 × $13.00) − $3.02 = $19.50 − $3.02 = $16.48/hr cash overtime rate

Tips must bring total pay (cash wage + tips) up to at least the full overtime rate. If tips fall short, the employer must cover the gap. Because Florida's minimum wage rises each September, the exact cash overtime rate changes with it — always use the minimum wage in effect on the date worked.

Source: FLSA §7, 29 CFR §531, DOL Wage and Hour Division tipped employee guidance.

New York Domestic Workers

New York's Domestic Workers' Bill of Rights creates a two-tier system:

  • Non-live-in domestic workers (day workers, nannies, housecleaners who do not reside with the employer): overtime applies after 40 hours in a workweek, consistent with the federal FLSA standard.
  • Live-in domestic workers (employees who reside in the employer's home): overtime generally applies after 44 hours in a workweek under New York Labor Law §161.

Both categories are explicitly covered by New York labor law, and both are entitled to 1.5× their regular rate for qualifying overtime hours. The main calculator uses the standard 40-hour weekly threshold; the New York state page notes the live-in exception.

Calculation Method

  • All calculations run client-side in JavaScript — no data is sent to our servers.
  • Weekly overtime uses a fixed 40-hour threshold unless state rules apply a different threshold.
  • Daily overtime, where applicable, is calculated per day before weekly totals are assessed.
  • Overtime hours are not double-counted — hours already compensated at a daily overtime rate are credited toward the weekly total.
  • Results are rounded to the nearest cent.
  • The calculator uses a single regular rate entered by the user. Workers with bonuses, multiple rates, or commissions should compute their blended regular rate first.

Accuracy Limitations

Calculator results are estimates based on standard payroll rules. They do not account for: income tax or payroll tax withholding, garnishments, tip credits (unless the tipped-worker option is selected), blended rates from multiple pay rates or bonuses, union contract terms, employer-specific policies, local ordinances that exceed state minimums, or industry-specific rules under IWC Wage Orders (California) or COMPS Orders (Colorado). Always verify with a payroll professional for situations outside standard hourly employment.

Review Schedule

Calculator logic and wage rates are reviewed at minimum annually — in January, when most state minimum wages update — and on an ad-hoc basis when state or federal rules change. Pages show a review date when content has been recently verified.

Feedback and Corrections

If you spot an error in a wage figure, formula, or explanation, please contact us. We investigate all correction requests and update pages promptly when a correction is verified.