Coaching Centre
Wages, overtime and penalty rates
Hourly wages, casual loading, overtime at time-and-a-half and double time, weekend and public holiday penalty rates, and working backwards to an hourly rate.
Most Year 11 students who have a job are paid by the hour, usually as casuals in retail or hospitality. Your payslip looks simple, but the rate changes depending on when you work. A Sunday shift can pay half as much again as the same shift on a Tuesday. Knowing how that works is how you check you've been paid properly.
Hourly wages
A wage is pay per hour. Your weekly pay is the hours worked times the hourly rate. Minimum rates are set by the award for your industry (for example, the retail award), and the Fair Work Ombudsman publishes them on its pay calculator. Workers under 21 often get a junior rate, which is a percentage of the adult rate.
Casual loading
Casual workers don't get paid sick leave or annual leave, and their hours can change week to week. To make up for that, most awards add a casual loading of $25\%$ to the hourly rate. So a casual's rate is the base rate times $1.25$.
Penalty rates and overtime
Working at unsociable times earns a penalty rate: a multiple of the normal hourly rate. The exact multiples depend on the award, but the language is always the same.
| Name | Multiplier | Rate when base is $\$30$ |
|---|---|---|
| Ordinary time | $\times 1$ | $\$30.00$ |
| Time-and-a-quarter | $\times 1.25$ | $\$37.50$ |
| Time-and-a-half | $\times 1.5$ | $\$45.00$ |
| Double time | $\times 2$ | $\$60.00$ |
| Double time-and-a-half | $\times 2.5$ | $\$75.00$ |
Overtime is work beyond your normal hours, commonly $38$ a week for full-time staff. A typical arrangement is time-and-a-half for the first $2$ or $3$ hours of overtime, then double time. Public holidays often pay double time-and-a-half. The rates in this section are examples, so always check your own award.
Ana is a permanent worker paid $\$30$ an hour for a $38$-hour week. This week she also worked $4$ hours of overtime: the first $2$ at time-and-a-half and the rest at double time. Find her pay.
Mia is a casual at a supermarket in Parramatta. Her base rate is $\$28$ an hour, plus $25\%$ casual loading. Saturday pays $1.25$ times her casual rate and Sunday pays $1.5$ times. She works $4$ hours on Thursday, $6$ on Saturday and $5$ on Sunday. Find her pay for the week.
The roster starts as Example 2 (Thu 4, Sat 6, Sun 5) on a $\$28$ base rate. Switch to casual and check you get $\$665$.
Keep the total hours at $15$ but move them to the weekend. How much more does the same $15$ hours pay? Turn on the public holiday and explain why one Wednesday shift can be worth more than two Thursday shifts.
Working backwards
To find a rate or a number of hours, write the pay as an equation in ordinary-hour equivalents. An hour at time-and-a-half is worth $1.5$ ordinary hours, so add up the equivalent hours and divide.
Jordan earned $\$808.50$ for $24$ ordinary hours and $6$ hours on a Sunday at time-and-a-half. Find his hourly rate.
Your turn
Priya's rate is $\$26$ an hour. She worked $32$ ordinary hours plus some hours at time-and-a-half, and earned $\$1144$. How many hours at time-and-a-half did she work?
Show the working
Ordinary pay: $32 \times 26 = \$832$. That leaves $1144 - 832 = \$312$. Each hour at time-and-a-half pays $26 \times 1.5 = \$39$, so she worked $312 \div 39 = 8$ hours.
The base rate is $\$25$ an hour. What is the time-and-a-half rate, in dollars?
$25 \times 1.5 = \$37.50$.
A base rate of $\$28$ an hour gets a $25\%$ casual loading. Find the casual hourly rate.
$28 \times 1.25 = \$35$.
Find the pay for $8$ hours at double time when the base rate is $\$27$.
Double time is $27 \times 2 = \$54$ an hour, and $8 \times 54 = \$432$.
A penalty rate is:
Penalty rates compensate workers for unsociable hours by multiplying the normal rate.
Lena earns $\$29.50$ an hour for $38$ hours, plus $3$ hours at time-and-a-half. Find her total pay.
$38 \times 29.50 = \$1121$. Overtime: $3 \times 29.50 \times 1.5 = \$132.75$. Total: $1121 + 132.75 = \$1253.75$.
On a $\$32$ rate, overtime is time-and-a-half for the first $2$ hours, then double time. Find the overtime pay for $3$ hours of overtime.
$2 \times 32 \times 1.5 = \$96$ and $1 \times 32 \times 2 = \$64$, so $96 + 64 = \$160$.
Jess works $5$ hours on Sunday at time-and-a-half, base rate $\$26$. Which calculation is correct?
The multiplier applies to the rate: $5 \times (26 \times 1.5) = \$195$.
Omar earns $\$910$ for a $35$-hour week at ordinary time. Find his hourly rate.
$910 \div 35 = \$26$ per hour.
Exam style: Sam earns $\$24$ an hour. One week he works $30$ ordinary hours and some hours at time-and-a-half, earning $\$900$ in total. How many hours at time-and-a-half did he work?
$30 \times 24 = 720$, so overtime earned $900 - 720 = \$180$. At $24 \times 1.5 = \$36$ an hour, that is $180 \div 36 = 5$ hours.
Exam style: Jordan is paid $\$808.50$ for $24$ ordinary hours and $6$ hours at time-and-a-half. Find his hourly rate.
Equivalent hours: $24 + 6 \times 1.5 = 33$. Rate $= 808.50 \div 33 = \$24.50$.