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  1. #1
    Yort is offline Junior Member
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    Calculating overtime with a per diem?

    What is the name of your state (only U.S. law) Illinois

    I am an Engineer. I have a home in Illinois but frequently do contract work all over the country. I have recently been offered a job in California that is expected to be a temporary 9 to 12 month project. I told the contract agency that I must have a per diem, which I am entitled. The contract agency agreed to provide a split per diem which is pretty standard in my line of work.

    The pay rate is $50 an hour, the per diem is $160 a day x 5 days a week. So the split would be this; $160 x 5 = $800/40 = $20 hourly per diem and $30 hourly rate.

    Now the agency is arguing that all overtime pay will be calculated using $30 an hour as my base rate NOT at $50. My argument is that they cannot deduct the per diem when they calculate the overtime. I have been on a per diem many times and have never heard of this "tactic", in fact I find it ridiculous as it would completely negate the benefit of the per diem.

    My question is are they correct or not? It seems like a scam to me.What is the name of your state (only U.S. law)?
  2. #2
    justalayman is offline Senior Member
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    a per diem is not wages and as such, it is not included in your hourly pay when calculating overtime.

    Beyond that, given you are an engineer, you might actually be exempt from the FLSA overtime pay requirements.


    in fact I find it ridiculous as it would completely negate the benefit of the per diem.
    really? a per diem is not intended to be an hourly based benefit. It is a per diem (that's day in latin) pay intended to compensate you for your daily costs to be in the distant location.

    Now, depending how your actual pay is defined, they may have no choice but to include the per diem pay in the OT calculations so, have you recieved a paycheck yet? If so, how is your wage calculation shown?
  3. #3
    swalsh411 is offline Senior Member
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    Scam? Not at all.

    Is the per diem taxed?
  4. #4
    Yort is offline Junior Member
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    Is there anyone on this forum who actually knows what their talking about?
  5. #5
    justalayman is offline Senior Member
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    Quote Originally Posted by Yort View Post
    Is there anyone on this forum who actually knows what their talking about?

    yep but since you don't wish to share, I guess you can wait for somebody else to be abused by you. Good luck with that.
  6. #6
    swalsh411 is offline Senior Member
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    It appears you would prefer to hear what you want to hear instead of correct answers. We get that a lot around here. Good luck getting an answer somewhere else because I don't think anybody else will be helping you.

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