If you have to calculate back pay, you might have been the victim of wage theft. Consult an experienced employment attorney like Rowdy Meeks Legal Group LLC to assess your claim and provide guidance as you work to recover your unpaid wages.

What is Back Pay?

Back pay is wages that an employer owes employees for work they previously completed work but which remains unpaid. Back pay or back wages typically arises when an employer fails to pay employees the wages they are entitled to under applicable wage laws or employment agreements.

Here are some reasons you may have to calculate back pay.

• Overtime Pay: If you work overtime but don’t receive overtime pay, you may be entitled to back pay for the unpaid overtime hours.
• Minimum Wage Violations: If your employer pays you below the minimum wage required by federal, state, or local law, you may be owed back pay to make up the difference between what you were paid and the minimum wage rate.
• Unlawful Deductions: If your employer unlawfully deducts wages from your paycheck, you may be entitled to back pay for the amount deducted.
• Off the Clock Work:  You may be entitled to pay including overtime for work you perform while you are not clocked into the employer’s timekeeping system such that the employer fails to pay you for this work.

How to Calculate Back Pay

The method for calculating back pay varies depending on the specific circumstances and nature of the wage violation, and the state in which you performed the work.

To determine your unpaid wages, you need to identify the specific wages not paid. For example, were they regular wages, overtime pay, minimum wage violations, or unpaid commissions and bonuses?

You will need detailed and accurate evidence to determine what back pay your employer owes. Documents like timesheets, pay stubs, work schedules, and your employment contract will help you determine the total number of hours you worked during the period for which the back pay is being calculated. You may use your best estimate of time worked if the employer fails to pay you for all time worked. The employer is legally required to track all time worked. If the employer fails to do so, then the employer must pay you for your best estimate of the time you worked.

Finally, different states have different minimum wage and overtime pay rates. Your employment attorney will help apply the applicable rate for your specific case.

Back Pay Rates

Calculating back pay rates is different for each type of wage violation. If your employer has failed to pay you your regular wage, then you would calculate the hours you worked and multiply them by your normal hourly rate.

Minimum Wage Violation

Let’s look at an example of calculating back pay for Sarah, an employee paid below minimum wage.

Sarah worked 160 hours over four weeks at $6.50 per hour instead of the federal minimum wage of $7.25 per hour.

To calculate her back pay:

Difference in hourly rate = $7.25 – $6.50 = $0.75 per hour

Total back pay owed = $0.75 per hour × 160 hours = $120

Therefore, Sarah is owed $120 in back pay for the period she was paid below the minimum wage.

Overtime

Let’s look at how John can work out back pay for the overtime hours he wasn’t paid for.

John worked 50 hours a week, including 10 hours of overtime, at a regular hourly rate of $12.

To calculate the overtime premium rate for time-and-a-half:

Regular hourly rate: $12 per hour Overtime premium rate (time-and-a-half): $12 × 1.5 = $18 per hour

Now, let’s calculate John’s back pay for the overtime hours:

Back pay for overtime = Overtime premium rate × Overtime hours $18 per hour × 10 hours = $180

Therefore, John is owed $180 in back pay for the 10 hours of overtime worked but not compensated at the correct time-and-a-half rate.

Why Would You Need To Calculate Back Pay?

Unfortunately, hard-working Americans are the victim of wage theft daily. However, if an employer has underpaid or wrongfully terminated an employee, the employer must repay the total wages the employer still owes the employee.

Under the Fair Labor Standards Act, employers are liable to pay the total value of an employee’s salary and benefits from when the underpayment begins until the claim is finalized. Employers may also be legally required to pay additional liquidated damages or attorney’s fees.

Rowdy Meeks Legal Group LLC: Fighting Unpaid Wage Disputes Nationwide

Employers face increasing pressure to lower wage and benefit costs in today’s challenging economy. But, that doesn’t mean you should suffer due to illegal wage practices.

If you need advice on how to calculate back pay, you should contact Rowdy Meeks Legal Group LLC for a free evaluation.