The Weighted-Average Overtime Method for Multiple Pay Rates
If you work at two or more hourly rates in one week, the FLSA does not pick one rate for overtime. It blends them: add all your straight-time earnings together, divide by your total hours, and that weighted average is your regular rate. Overtime is 1.5 times that blended rate for hours over 40. Try it in our overtime pay calculator by entering a second rate and the hours worked at it.
Plenty of workers earn more than one rate in a week. A warehouse associate covers a forklift shift at a higher rate. A nurse picks up a weekend differential. A retail worker splits time between the sales floor and the stockroom at different pay. When overtime hits, the question is obvious: which rate gets the 1.5x multiplier? The Department of Labor's answer, in Fact Sheet #23, is neither. You compute one blended regular rate for the whole week, then apply the overtime premium to that.
The exact method
The rule is one sentence: where an employee in a single workweek works at two or more different types of work for which different straight-time rates have been established, the regular rate for that week is the weighted average of such rates. In practice, that means three steps. First, multiply each rate by the hours worked at that rate and add the results: that is your total straight-time earnings. Second, divide by the total hours you worked at all rates: that is your regular rate. Third, pay 1.5 times the regular rate for every hour over 40.
Notice what the method does not do. It does not average the two rates (a simple average of $15 and $20 is $17.50, which is wrong unless the hours are equal). It does not let the employer use the lower rate for overtime. And it does not let the employer use the higher rate either, which is why the rule is fair in both directions: the blended rate reflects the actual mix of work you did.
Worked example 1: two rates, one week
You earn $15 per hour for 30 hours of regular duties and $20 per hour for 20 hours of skilled work, for a 50-hour week. Step one: $15 x 30 = $450, plus $20 x 20 = $400, for total straight-time earnings of $850. Step two: $850 / 50 hours = $17 per hour. That $17 is your regular rate. Step three: your overtime rate is 1.5 x $17 = $25.50, and you have 10 overtime hours, so your overtime pay is $255. Your gross for the week is $850 + $255 = $1,105.
Compare that to the mistakes. An employer that pays overtime at 1.5x the lower rate gives you $22.50 per overtime hour, shorting you $30 for the week. An employer that uses the higher rate pays $30 per overtime hour, overpaying by $45. The weighted average is the legally correct number, and it is the only one that reflects your actual week.
Worked example 2: shift differential
You work 40 day hours at $18 and 10 night hours at $18 plus a $3 night differential, so the night rate is $21. Your straight-time earnings are (40 x $18) + (10 x $21) = $720 + $210 = $930. Your regular rate is $930 / 50 = $18.60. Your overtime rate is 1.5 x $18.60 = $27.90, and your 10 overtime hours pay $279. Gross: $930 + $279 = $1,209.
The differential matters twice. It raises your straight-time earnings, which raises the blended regular rate, which raises the overtime rate. Employers that compute overtime on the base rate and treat the differential as a separate flat add-on are doing it wrong. The differential is part of the regular rate, full stop.
Worked example 3: salary plus hourly
You earn a $600 weekly salary and also work 10 hourly shifts at $15, for a 50-hour week. Total straight-time earnings: $600 + $150 = $750. Regular rate: $750 / 50 = $15 per hour. Overtime rate: $22.50. Ten overtime hours pay $225. Gross: $975. The salary does not shield those extra hours from overtime, and the hourly pay does not get a separate overtime calculation. Everything blends into one regular rate.
The alternative: the rate-in-effect method
There is a second legal way to compute overtime with multiple rates, and you should know it exists because some employers use it. Section 7(g)(2) of the FLSA allows overtime to be computed at 1.5 times the hourly rate in effect when the overtime work was performed, but only under specified conditions: there must be an agreement or understanding in advance, the rate has to be a bona fide rate for that type of work, and the detailed requirements in 29 CFR 778.415 through 778.421 have to be met. Without that prior agreement, the weighted average is the default, and it is the method the Department of Labor applies when it audits.
The rate-in-effect method can pay more or less than the weighted average depending on when the overtime hours fell. If your overtime hours happened during your higher-paid shifts, it pays more. If they fell during your lower-paid shifts, it pays less. That is exactly why the law requires the agreement up front: so the method cannot be chosen after the fact to minimize the check.
What to check on your pay stub
Weighted-average errors are quiet. The stub shows two rates and an overtime line, and everything looks plausible until you do the division yourself. Reconstruct the week: rate times hours for each rate, summed, divided by total hours. That is your regular rate. Multiply by 1.5 and by your overtime hours. If the stub's overtime line is smaller, the employer probably used one rate instead of the blend, or left the differential out of the regular rate. Both are fixable, and both are common enough that the Department of Labor lists them among typical overtime violations.
Rules current as of October 2026. Source: U.S. Department of Labor Fact Sheet #23 (dol.gov).