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How to Calculate Time-and-a-Half Pay

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Time-and-a-half pay is a common expression referring to overtime pay wages. State laws normally require that employers pay hourly workers and nonexempt salary workers overtime pay when they work more than 40 hours in one week. Time-and-a-half is the common overtime pay rate. While calculating this amount for your gross income is quite simple, you should also factor in additional deductions that time-and-a-half pay can trigger on your paycheck.

The Good News: Gross Income

You can find an overtime calculator online, or work out the math yourself.. You just multiply the standard wage times 1.5. For example, time and a half for $14 an hour is $21 per hour. Half of 14 is 7, so add the half to the regular hourly wage to calculate time and a half.

If a laborer makes $14 per hour, his overtime rate is $21 per hour. In a 50-hour week, he earns $560 in regular pay and $210 in overtime pay, for a total of $770 that week, which is $70 more than he would have made without the time-and-a-half pay.

(40 hours x $14) + (10 hours x $21) = $770

The Bad News: Net Income

Earning time-and-a-half pay does increase your income by 50%, but your take-home pay after deductions will seldom be boosted by so much. Depending on your current tax bracket and the state you live in, much of your overtime pay will be taken off your check before you get it.

For example, if a worker earns $20 per hour and is working an extra 8-hour shift each week for time-and-a-half pay, her overtime pay will be $30 per hour. This works out to be $240 extra each week in gross income. However, this also increases her tax bracket, so her deductions will be increased too. With state and federal income taxes, as well as increased employee-paid payroll tax, that extra $240 means her net income, or take-home pay that week will be closer to $144.

Overtime and Your Budget Planning

If you are budgeting, a good rule of thumb is to estimate about half of your overtime pay will get to you after deductions. Once you get paid, you can use your actual deduction numbers to calculate how much you will get in net income the next time you work extra hours.


Neil Kokemuller has been an active business, finance and education writer and content media website developer since 2007. He has been a college marketing professor since 2004. Kokemuller has additional professional experience in marketing, retail and small business. He holds a Master of Business Administration from Iowa State University.

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