What are the state prevailing wage overtime requirements?
A laborer or mechanic must be paid for all hours in excess of the prevailing hours at an hourly rate of at least 1½ times the hourly basic rate of pay plus fringe benefits. The minimum "hourly basic rate" may not be lower than the "basic rate" established by the Minnesota Department of Labor and Industry and the prevailing hours of labor may not be more than 8 hours per day or more than 40 hours per week.
What are the federal prevailing wage overtime requirements?
A laborer or mechanic must be paid for all hours in excess of 40 hours per week at an hourly rate not less than 1½ times the hourly basic rate of pay plus fringe benefits. The minimum "hourly basic rate" may not be lower than the "basic rate" established by the United States Secretary of Labor.
How do I calculate overtime on a prevailing wage project?
- OT: overtime
- PW: the basic hourly prevailing wage rate established in a federal and/or state prevailing wage determination
- HW: hourly wage rate paid to a worker
- RF: remaining fringe, which means the difference between the contract hourly benefit rate and the actual hourly benefit rate paid by the contractor to a third party on behalf of a worker
- F: fringe benefit contributions that are bona-fide contributed by an employer to a third party on behalf of a worker
To calculate the overtime compensation owed to an employee, multiply the basic rate as shown in the state and/or federal wage decision(s) by .5; add the basic hourly rate paid to the employee; then add any wages that were paid in lieu of fringe benefits.
Overtime calculation formula: OT = (PW * .5) + (HW) + (RF) + (F)
The total hourly prevailing wage rate for a worker is $30.00, which is comprised of an hourly basic rate of $20.00 and an hourly fringe rate of $10.00.
The table below shows various hourly basic and fringe benefit payments that a contractor could potentially make to a worker.
PLEASE NOTE: The last example provided indicates that an employee is paid a total of $28.00 per hour; which is $2.00 less than what is required. Regarding straight time pay, the contractor would be required to pay the employee $26.00, which is comprimised of the $24.00 that is normally paid to the employee and an additional $2.00 that is paid in lieu of fringe benefits. However, the $2.00 per hour paid in lieu of fringe is NOT subject to the half time premium.
|Hourly Wage Paid||Fringe Benefits Paid||Payment to Employee
(PW * .5) + (HW) + (RF)
|$20.00||$10.00||($20.00 * .5) + ($20.00) + ($0.00) = $30.00||+ $10.00||= $40.00|
|$18.00||$12.00||($20.00 * .5) + ($18.00) + ($0.00) = $28.00||+ $12.00||= $40.00|
|$22.00||$8.00||($20.00 * .5) + ($22.00) + ($0.00) = $32.00||+ $8.00||= $40.00|
|$30.00||$0.00||($20.00 * .5) + ($30.00) + ($0.00) = $40.00||+ $0.00||= $40.00|
|$24.00||$4.00||($20.00 * .5) + ($24.00) + ($2.00) = $36.00||+ $4.00||= $40.00|
PLEASE NOTE: If an employee's hourly regular rate of pay is greater than the hourly basic rate of pay established by the Minnesota Department of Labor and Industry or the United States Department of Labor, the contractor must compensate the employee not less than 1½ times the hourly regular rate of pay at which the employee is employed.
What are the Fair Labor Standards Act Overtime Calculation Requirements?
An employee must be paid for all hours in excess of 40 hours in a workweek at a rate not less than 1½ times the hourly regular rate at which the employee is employed.
Do other state and federal overtime regulations apply?
Yes. Both the state and federal government have established overtime regulations; neither preempts the other. Both state and federal overtime laws establish minimum hourly overtime requirements and can apply concurrently.