::::::Employer savings:
:::This is a small calculator to determine how much money employers are saving by not paying overtime wages.
Overtime is considered anything over 40 hours per week for this calculator.
The minimum US overtime rate is 1.5x and is used in this calculator.
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| Hourly Rate: |
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| Salary/Yearly Income: |
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| No Overtime Rate Paid: |
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| Overtime Paid: |
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| Effective Hourly Rate (no overtime rate): |
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| Effective Hourly Rate (with overtime rate): |
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Employer savings: |
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| No Overtime Rate: |
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| With Overtime Rate: |
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| Difference Between Overtime Rate and No Overtime Rate: |
By not paying you overtime, you are not only missing out on a significant amount of takehome pay, but you are also missing out on unemployment benefits, should you lose your job. You are also missing out on contributions to your 401K, social security, and other benefits you are entitled to based on your wages.
Just for context, the current $35,568 minimum for not paying overtime means that your employers don't have to pay overtime if you are making over $17.10 an hour. And for some more context: if you are the only wage earner in for a family of 5, the poverty level is $35.140 in 2023.
For an example: if you are making $20 an hour, your yearly income is $41,600. If you work 45 hours a week, you should be getting $46,800 just on hours alone, but with a 1.5x overtime rate, you should be getting $49,400. So, someone getting paid a flat hourly rate of $17.78 is making the same yearly income as you are ($41,600) while working the same amount of hours. Someone getting paid 1.5x overtime for those same hours only has to make $16.84 an hour to earn the same $41,600 as you currently are. Just on a flat hourly rate, the difference is $5200 (12.5%) in your yearly income. That's more than a month's pay of $3200. The difference between your current income and you getting a 1.5x overtime rate is $7800 (18.75%) per year, which is nearly an extra 2.5 months wages. And the difference between an overtime rate and the flat hourly rate is $2600 (6.25%). All of that is "just" 5 hours of overtime every week.
For another example: let's say you are making the same $20 an hour, but you work 80 hours instead of 45 in the last example. With overtime, you should be making $104,000 per year. That's 2.5x your base salary of $41,600.You are losing out on $62,400 per year. Now multiply that by how many coworkers you have and you can see how much money the company you work for is making by not paying you overtime and by not hiring more people to do the same amount of work. Just with 10 employees, the company is saving $624,000 just on wages. That doesn't include how much they currently don't have to pay in wage based fees, like unemployment insurance.
Also, think about how much more you would have in your retirement saving accounts if you were paid overtime. Your 401K, your social security, and a lot of other benefits you earn through your wages would be considerably better off if you were paid for the overtime you worked.
"Hours Per Week" are the amount of hours you are working during an average week.
"Hourly Rate" is how much you get per hour. If you don't know this, it can be calculated from your yearly wages by dividing by 2080.
"Salary/Yearly Income" is what you make in a year. It can be calculated from your hourly rate by multiplying by 2080.
"No Overtime Rate Paid" is what you should be getting each year if you were getting paid hourly, but no overtime rate is applied.
"Overtime Paid" is what you should be getting each year if you were getting paid hourly and getting paid the minimum of 1.5x for your overtime.
The "Effective Hourly Rate (no overtime rate)" is the hourly rate for someome working the same amount of hours as you and getting paid hourly (but no overtime rate) while making the same yearly income as you currently are.
The "Effective Hourly Rate (with overtime rate)" is the hourly rate for someome working the same amount of hours as you and getting paid hourly, and getting paid the minimum overtime rate, while making the same yearly income as you currently are.
The "No Overtime Rate" is how much more you should be getting paid just by paying you your flat hourly rate for the overtime you work.
The "With Overtime Rate" is how much more you should be getting paid if you were working under normal hourly rates with a 1.5x overtime rate.
And, for completeness, the "Difference Between Overtime Rate and No Overtime Rate" is the difference between getting a flat hourly rate and getting paid 1.5x for overtime hours.