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B. Calculation of the Regular Rate of Pay

 

According to 29 C.F.R. 778.109, "the regular hourly rate of pay of an employee is determined by dividing his total remuneration for employment (except statutory exclusions under section 207(e)) in any workweek by the total number of hours actually worked by him in that workweek for which such compensation was paid." "Total remuneration" means all wages earned by the employee during that week from whatever work was done and by whatever pay methods are used. For example, if an employee is paid an hourly rate plus a commission, the regular rate would be the straight-time hourly earnings plus the commission for that workweek, divided by the total number of hours worked during the workweek. If on top of that a productivity bonus is paid, the bonus would be added to the hourly earnings and the commission and then divided by the number of hours worked to arrive at the regular rate for that workweek. "Hours actually worked" does not include paid leave or holiday hours.

 

No matter what pay method is used, the regular rate of pay for overtime calculation purposes must be no less than minimum wage. The following topics describe in detail the methods for calculating overtime pay depending upon the pay method used for an employee. For a brief summary of all of the methods, see the "Conclusions" section at the end of this article.

 

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