Question on Flat Fees and OT compensation

M

MeliMoore

New Member
Jurisdiction
Wisconsin
Hi everyone!

Payroll question for you guys...

Radio broadcasting station wants to know if they can pay their employees a flat rate for an hourly employee who volunteers to broadcast a specific event (high school football, for example).

Any hours spent during the event would still need to be counted towards total hours per week for OT calculations since they are not exempt. Would I treat the 'flat rate' as if it were a variable rate in regards to how the overtime rate is calculated for any hours worked over 40 in that week?

Is there a better way to do this that I am not considering?

Thanks! I appreciate the feedback, as always.
 
The first thing they'd need to be careful of is that the flat rate is sufficient to mean that they are still receiving no less than minimum wage for hours worked, plus overtime for hours over 40. I'll let the payroll experts address the specifics.

Good to see you, MeliMoore - how have things been?
 
Things have been great! I switched jobs a few years ago and am now the HR Manager for a regional accounting firm. Its been a fun transition from my days in staffing/recruiting. :) Its a great company to work for that places high value on strategic HR. Are you still at the University?
 
adjusterjack said:
Yeah, pay him his hourly rate for the time spent broadcasting the event.

Why complicate your life when it isn't necessary?
Click to expand...

Agree completely.

This is a question that came from a client of one of my CPAs. I am just tasked with providing the answer of how they could do it, if they chose to. My recommendation will be to pay hourly.
 
Yep, I've been there for six years now. We're in the middle of Open Enrollment now - you can only imagine what that's like. If I live till Thanksgiving I'll survive, but it's a wild ride for sure! C'mon back and play with us anytime you take the notion - I miss the old gang that isn't here!
 
I'll admit, benefits is not the favorite part of my job. I can't even imagine how it looks across a full University. Yes, I will definitely try to jump back on more often. I miss the old crew as well. I'm going to cruise over to MH thread later tonight. :)
 
There is a way to calculate this.....Hope I can write it out....
Basically take all pay for the workweek including the flat rate... and divide by total hours worked including all hours at the event. That will get you to regular rate of pay (RRP). From there, you have to look at how many OT hours there were and pay them at 1/2 RRP more. I am going to try to give a "simple" example.

40 hours at $10 a hour = $400 on timeclock
4 hours at a flat rate of $100 for event

Total pay = $500 for 44 hours. RRP = $11.36 so OT 1/2 would be $5.68 extra for each of the 4 OT hours.

They still have to be clocking the actual hours worked at the event, so a flat rate really doesn't do them much good when you need the hours for this calculation anyway! So I have to agree my recommendation is to pay him his regular rate of pay unless they are trying to incentivize him to do the event. Even then I would suggest and 2nd higher rate of pay for those hours (but then it does get back to a calculation similar to above, but most payroll systems can handle it better)
 
Thank you very much! That was the line of thinking that I had, but I do not pretend to be a payroll expert by any stretch. I appreciate the help! Have a great week.
 
Thank you for sharing Elle. After reading it through, I am pretty sure that the employees in question wouldn't qualify. These broadcasters would be "gathering facts on routine community events" which would not be considered creative professionals. Its a pretty standard, small-town news broadcast.
 

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