Human Resource Blog

New Jersey Fluctuating Work Week

	Compensation
Employee Payroll Action Form W-4 Employee Withholding Allowance Cert. Employee Payroll Status/Change Form Direct Deposit Form Total Compensation Summary

	HR Management
Confidential Employee Folder Confidential Employee Medical Folder Job File Worksheet Folder Daily EEO Applicant Flow Log Workplace Information Sheets Request to Inspect Personnel Files

Can you explain the fluctuating work week or Belo plan in New Jersey?

The Belo plan or fluctuating work week is a payment plan where employees are paid a flat salary for all hours worked during the week. Overtime is paid at one-half the hourly rate. This plan is utilized in industries such as landscaping and golf courses, where hours worked fluctuate by season.

The federal and New Jersey state laws allow this plan because the flat salary covers the hourly rate. At no time can the hourly rate (salary divided by the number of hours worked) drop below the state or federal minimum wage. Also, the worker must have some weeks where they work less than 40 hours.

The system is used for two reasons. The fluctuating work week saves employers money on overtime costs. It also provides seasonal workers with a regular rate of pay, even when hours worked fluctuate.

James, who works for a landscaping firm, provides an example. James gets paid a flat rate of $500 per week, no matter the number of hours he works. Say James works 35 hours. Divide $500 by 35 for the average hourly rate of $14.29. If James puts in 70 hours during the week, his per hour rate drops to $7.15 ($500/70). James is eligible, too, for overtime pay for the 30 extra hours worked.

To figure his overtime, take the hourly rate of $7.15; multiply it by the overtime hours of 30, then multiply that by 0.5. The result is $107.25 which comes to only $3.58 per hour. That seems low, but since his overall hourly rate of $10.73 exceeds the state and federal minimum, it’s legal.

Clearly, James doesn’t make a lot of extra money when he works more than 40 hours in a week. He does, however, receive the $500 a week, even if he only works 3 or 4 hours.

It is very important that each employee understand exactly how the Belo plan works, and how he or she will be paid. A written explanation in the form of a memo or an offer letter which requires the employee’s signature is the ideal method.  JH