What is the regular rate of pay?
The hourly rate overtime is based on: all pay for the workweek's work divided by the hours worked, not just the base hourly wage.
Non-discretionary bonuses (promised for attendance, production or hitting a target), shift differentials and similar pay raise the regular rate, so overtime has to be paid at 1.5 × that higher rate. Discretionary bonuses, holiday gifts, expense reimbursements and pay for time off are excluded.
A time card calculator that multiplies hours by the base wage gives the right answer only when no such extra pay exists that week.
Sources
Related terms
- Overtime (federal)For non-exempt employees, pay of at least one and a half times the regular rate for hours worked over 40 in a workweek.
- FLSA workweekUnder the federal Fair Labor Standards Act, a fixed and regularly recurring period of 168 hours (seven consecutive 24-hour periods) used to count overtime.
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