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## How is Weighted-Average Overtime Calculated? Weighted-average overtime is calculated using the following 4-step mathematical equation:

1. All hours are treated as straight time (ST) and the hours are multiplied by the ST rate of pay to determine TOTAL A.
2. TOTAL A is then divided by the total hours worked in the week and then divided by 2 to determine RATE B.
3. RATE B is multiplied by the number of hours over 40 to determine TOTAL C.
4. TOTAL A  plus TOTAL C = weighted average gross pay.

An expanded example:  Joe works 25 hours at \$10.00/ph and 25 hours at \$12.00/ph for a total of 50 hours in the workweek.  10 hours of overtime are calculated.

1. (25 hours x \$10.00) \$250.00 + (25 hours x \$12.00) \$300.00 = \$550.00
2. \$550.00 divided by 50 hours = \$11.00 divided by 2 = \$5.50
3. \$5.50 x 10 hours = \$55.00
4. \$550.00 + \$55.00 = \$605.00 weighted average gross pay

That's a lot of calculations for each employee, each week!