Weighted Average Overtime: How to Calculate Pay With Multiple Hourly Rates

Weighted average overtime uses an hours-weighted pay rate when someone works at different straight-time hourly rates in the same workweek. You add the relevant earnings and divide by the hours that produced them. A simple average of the rates is wrong unless the hours at each rate happen to be equal.

This guide models a covered, nonexempt U.S. employee under the standard federal weekly overtime approach. It assumes no other includable earnings, no excluded payments and straight-time pay already calculated for every hour worked. State rules, contracts and special arrangements may require a different or additional calculation.

Start with all straight-time earnings

Assume an employee works 30 hours at $20 and 15 hours at $26 in one workweek. All 45 hours receive their applicable straight-time rate first.

Two-rate workweek
Assignment	Hours	Rate	Straight-time earnings
Role A	30	$20	$600
Role B	15	$26	$390
Total	45	Weighted below	$990

The weighted regular rate is $990 ÷ 45 = $22 per hour. The unweighted average, ($20 + $26) ÷ 2 = $23, would give too much influence to the higher rate because fewer hours were worked at that rate.

Add only the missing premium

With a 40-hour threshold in this example, overtime hours are 45 − 40 = 5. Straight-time earnings already pay those five hours once. To reach time and a half, add another half of the $22 regular rate for each overtime hour.

Weighted rate = 990 / 45 = 22
Additional premium = 5 × 22 × 0.5 = 55
Total gross pay = 990 + 55 = 1,045

Adding 5 × $22 × 1.5 on top of $990 would double-count the straight-time component of the overtime hours. Conversely, paying only the $990 would omit the premium. Keep the earnings subtotal and premium as separate lines so a reviewer can see the difference.

Apply the formula to different hour allocations

If the same employee instead works 20 hours at $20 and 25 hours at $26, straight-time pay becomes $1,050. Divide by 45 to get $23.333333…; five additional half-time premiums total $58.333333…, giving $1,108.33 after rounding the final total to cents.

Both weeks contain 45 hours and the same two listed rates, but their weighted rates differ. Recalculate for each workweek. Retain precision through intermediate calculations rather than rounding the regular rate early to two decimals.

Check which earnings belong in the numerator

The U.S. Department of Labor explains that the regular rate generally includes employment remuneration unless a statutory exclusion applies. Additional items such as certain bonuses or differentials can make the actual numerator larger than base-rate earnings alone. Use payroll's classification of each earning, not just the label shown on a timesheet.

Do not average two workweeks together to make a high-hours week disappear. The Department's standard rule operates on a fixed recurring workweek. It also describes a conditional alternative under section 7(g)(2); the rate in effect during overtime is not a shortcut that automatically applies whenever multiple rates exist.

Reconcile the payslip

Check total hours by role, straight-time earnings, the regular rate used for the premium, overtime hours and the final gross amount. A pay stub may present these components differently, so compare the arithmetic before concluding that a missing label means missing pay. A one-rate overtime calculator is useful for a one-rate scenario; it does not automatically build this weighted earnings base.

Primary source: U.S. Department of Labor Fact Sheet 23, checked October 21, 2026. Calculations above are original illustrative examples, not a determination of individual legal entitlement.

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