July 23, 2020
When calculating FTE, we do not use overtime hours, as I understand it, but do we use overtime dollars when calculating the reduction in payroll?
Posted by Armanino Financial Advisory Team
The Salary/Wage Reduction Factor calculation uses the average hourly wage paid to the employee, without regard for overtime wages. However, if an employee does have a reduction beyond the 25% threshold, you would multiply that excess reduction in the hourly wage by the average weekly paid hours for the employee during Q1 2020, which does include any overtime hours they worked in the quarter.