The Fair Labor Standards Act defines regular rate of pay to include all remuneration for employment except certain payments excluded by the Act itself. Payments which are not part of the regular rate include:
- Expenses incurred on the employer’s behalf,
- Premium payments for overtime work or true premium paid for work on Saturdays, Sundays and holidays,
- Discretionary bonuses,
- Gifts and payments in the nature of gifts on special occasions, and
- Payments for occasional periods when no work is performed due to vacation, holidays, or illness.
Source for News notes: Calculating Overtime Just Got Trickier for Some Employers by Laura K. Sitar, Shareholder at Wroten & Associates.