How do I compute the average regular rate of my employee who is paid a fixed salary each workweek?

It depends. If you pay your employee exclusively through a fixed salary that is understood to be compensation for a specific number of hours of work in each workweek, the employee’s average regular rate would simply be the hourly equivalent of that salary.

However, if the fixed salary is understood to compensate the employee regardless of the number of hours of work in each workweek, then the regular rate may vary alongside the number of hours worked for each workweek. In this case, you would have to add up the salary you paid your employee over all full workweeks in the past six months and divide that sum by the total number of hours worked in those workweeks. If you lack records for the number of hours your employee worked, you should use a reasonable estimate.

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