This article will cover the automatic overtime engine and how to create overtime rules:
Our overtime calculation engine will adjust based on the state you are in. Due to constantly changing government regulations, Toast does not guarantee accuracy of overtime calculations. Please reference your local labor laws to ensure your overtime calculations are accurate.
This article will cover more of what you need to know about the overtime calculation engine.
State by State Exceptions
Our overtime calculation engine is an automatic tool that is based on this website from the Department of Labor. The engine pulls data from inside each of the individual state boxes, also taking federal laws into consideration.
It's important to note that the engine does not include the exceptions. For example, Alaska has an exception that states "The premium overtime pay requirement on either a daily or weekly basis is not applicable to employers of fewer than 4 employees." If an exemption applies to your restaurant, Toast will not factor that in automatically.
Since the overtime calculation engine is automatic, it can't adjust for exceptions. If your restaurant is an exception to your state's rules, it's possible to make the adjustments needed after exporting your Labor Report.
No Blended Job Compensation
There may be instances when an employee works two different jobs and is paid two separate wages. For example, George is paid $7.25 when he is a server and a $10 when he is a host. Regardless of how the time was spent over the course of 40 hours, if George passes the overtime threshold, he will be paid overtime for the role he is clocked in as. In the future, Toast hopes to have blended job compensation.
Overtime information on employees can be found under Labor Reporting.
Creating a New Overtime Rule:
While Toast allows each restaurant to configure and manage their own overtime rules, we are not liable for overtime miscalculations.
If you have employees that are eligible for overtime pay, Toast can automatically calculate the overtime pay amount by configuring it in Toast's management backend. Note that the following overtime rules have been pre-configured in your Toast system:
- ALL States: Any work in excess of forty hours per seven days receives a pay rate of time and a half.
- AK: Any work exceeding eight hours per work day receives a pay rate of time and a half.
- CA: Any work in excess of 1) eight hours in one workday, 2) 40 hours in one workweek, and 3) in the first 8 hours worked on the seventh day of work in any one workweek receives time and a half.
- CO: Any work exceeding 12 hours per work day receives a pay rate of time and a half.
- KY: On the seventh day worked in any one workweek, the employee receives a pay rate of time and a half.
- NV: Any work exceeding eight hours per work day receives a pay rate of time and a half
To create a new Overtime Rule:
Navigate to Overtime Rules under the Labor section of Toast's backend. Select +Add Overtime Rule and choose if the rule should be applied to weekly hours, daily hours, or consecutive days worked.
Add in the Daily Hours (or Weekly Hours/Consecutive Days) and the Overtime Rate Factor in the text boxes. For example, if employees receive time and a half after reaching 40 hours, enter 1.5 as the Overtime Rate Factor. Select Add Rule and Save your changes.
The Overtime Rule you've added will be listed.
To make changes to an existing rule, select the name of the rule, enter the new amounts, and choose Update Rule.