How to Calculate Blended-Rate Overtime (FLSA Weighted Average)

Here's a wage-and-hour mistake that's easy to make and expensive to get wrong: a worker performs two different jobs at two different pay rates in the same week, works more than 40 hours, and you pay the overtime at whichever rate they happened to be on for those extra hours. Under the FLSA, that's not how it works, and the difference is real money and real liability.

Overtime in that situation is owed at 1.5 times the weighted-average (or "blended") regular rate. Here's the rule, the formula, a worked example, and a free blended-rate overtime calculator so you never have to eyeball it.

The FLSA Rule

When a nonexempt employee works two or more jobs at different pay rates in a single workweek, the federal Fair Labor Standards Act requires their overtime premium to be based on the weighted average of all the rates they worked that week, not the highest rate, and not the rate tied to the specific overtime hours. That weighted average is the "regular rate" for overtime purposes.

The Formula

Two steps:

Step 1 — find the blended (weighted-average) regular rate:

Blended Rate = Total Straight-Time Pay ÷ Total Hours

Step 2 — add the overtime premium on the hours over 40:

OT Premium = 0.5 × Blended Rate × Hours Over 40

You pay all hours at straight time first, then add a half-time premium on the overtime hours, because the straight-time portion of those hours is already included in step one.

A Worked Example

Say a worker logs two assignments in one week:

• 30 hours at $18/hour = $540
• 15 hours at $22/hour = $330
• Total: 45 hours, $870 in straight-time pay

Now the overtime:

• Blended rate = $870 ÷ 45 = $19.33/hour
• Overtime hours = 45 − 40 = 5
• OT premium = 0.5 × $19.33 × 5 = $48.33
• Total gross pay = $870 + $48.33 = $918.33

Pay the overtime at the flat $22 rate instead and you'd overpay; pay it at $18 and you'd underpay and create liability. Only the blended rate is correct.

Why It Matters

• Compliance risk. Wage-and-hour errors are among the most common and most costly payroll mistakes. Systematically mishandling blended overtime across many workers adds up fast in back pay and penalties.
• It's easy to miss manually. The mistake usually isn't bad intent, it's a spreadsheet that doesn't know a worker had two rates that week. High-volume light-industrial staffing, where the same person may cover two roles, is exactly where it shows up.

A State Caveat

The blended-rate method above is the federal FLSA rule for weekly overtime over 40 hours. Some states layer on additional requirements, California's daily overtime rules are the best-known example, that can change the result. Always check the rules for the states you operate in.

Let Payroll Do the Blended Math

This is precisely the kind of calculation that should never be manual. FreshStaff's time tracking and native payroll apply the correct blended rate automatically whenever a worker logs multiple pay rates in a week, so the paycheck is right without anyone reaching for a calculator, and it flows straight into client invoices. All of it at $0 recruiter seats.

Run the Numbers

• Blended-Rate Overtime Calculator — two rates and hours in; blended rate, OT premium, and total pay out.
• Bill Rate Calculator and Labor Burden Calculator — price the work around your true costs.

The Bottom Line

When a worker earns more than one rate in a week and crosses 40 hours, overtime is owed on the weighted-average rate, not the higher one and not the lower one. Get the method right, automate it so it stays right, and check your states for daily-overtime rules on top. It's a small formula that protects you from a large problem.

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For the authoritative federal rule, see the U.S. Department of Labor Wage and Hour Division overtime guidance.