The Wage Qualifier uses the following formula to calculate the average rate for the week:
Average rate = (total amount for work details + total amount for premiums)/(total hours for work details + total hours for premiums)
Each value in the average rate formula is calculated as follows:
- Total amount for work details = sum (hours for each eligible pay category) * original rate for corresponding eligible pay category) in a week
- Total hours for work details = sum (all eligible hours for pay category) in a week
- Total amount for amount-based premiums = sum (pay amount for each eligible pay category) in a week
- Total amount for time-based premiums = sum (hours for each eligible pay category * effective rate for corresponding eligible pay category) in a week
- Total amount for premiums = total amount for amount-based premiums + total amount for time-based premiums
- Total hours for premiums = sum (all eligible hours for each eligible pay category) in a week
Consider an example where the qualifier is configured as follows:
| Setting | Configuration |
|---|---|
| Set A rate type | Average/Regular Rate |
| Set A multiplier value | 1 |
| Comparison operator | GreaterThanOrEqual |
| Set B rate type | Fixed Value |
| Set B multiplier value | 1 |
| Set B fixed value | 47.6554 |
| Minimum wage level | City |
| Average/regular rate pay category eligible | OT 2.0 |
In this scenario, the qualifier is configured to use the average rate only for the OT 2.0 pay category. If in a week an employee’s original rate was $49.8569 and the employee worked 7.5 hours, the average rate will be calculated as follows:
Total amount = sum of all [(hours for each OT 2.0 pay category in the week) * (original rate)]
Total hours = sum of all hours for the OT 2.0 pay category in the same week
Average rate = total amount / total hours
Total amount = 7.5 * 49.8569
Total hours = 7.5
Average rate = (7.5 * 49.8569) / 7.5 = $49.8569
In this case, the average rate is the same as the original rate, because only one pay category is being considered. Additionally, because it is greater than 47.6554, the value configured in the Set B fixed value field, the average rate calculated by the qualifier is applied for this scenario.