Beginning August 5, Pennsylvania employers with salaried, nonexempt employees cannot use the fluctuating workweek method of calculating overtime pay for salaried employees. Instead, employers must (1) calculate the regular rate of pay by adding all remuneration paid to the employee during the workweek and divide this amount by 40 hours - not the total hours the employee worked, and (2) multiply that rate by the number of overtime hours worked that week and then multiplying that rate by 1.5. This reflects a change in the Pennsylvania Minimum Wage Act (PMWA) and a divergence from the federal Fair Labor Standards Act (FLSA).
Background
Employers may pay nonexempt employees a salary that represents straight-time wages for all of the employees' work performed in a workweek, regardless of the number of hours they worked in that workweek. However, nonexempt employees who are paid on this basis must receive overtime compensation for hours worked over 40 in a workweek...
