> put a different way, no rational person would choose $100k + time and a half overtime over a flat $500k to do the same amount of work.

This seems extremely unlikely to ever be the actual two options someone might have.

More likely is something like 100k + time and a half OT versus 120k flat rate.

And rational people will take the flat rate, because the company will assure them "We don't ask for much Overtime"

And by the end of the year you've given them 100k worth of free labour.