Updated with this image to point out overhead in this image.

So I have 2 issues.  The labor costs above, and the actual overhead in this image.

Please log a case with support so they can investigate why you are receiving unexpected results.

@ltussing03  You should check whether labor rate it updated in the database?
I ran a quick test and had updated labor rate. If you added a labor line before updating the Labor rate then system won't update the rate until you reselect the employee to update it. 

Pragati, thanks.  The labor rate was not changed.

Angie, thanks, I will open a support case.