E. Regular Rate for Day Rates and Job Rates

Some employees are paid a daily rate or a job rate, which is intended to cover whatever hours it takes the employee to perform the work that day or for a particular job. Such a pay method is allowed as long as it results in overall compensation equal to at least minimum wage for all hours worked. Under 29 C.F.R. 778.112, the regular rate is determined by adding together all the daily-rate payments for the workweek, or all the job-rate payments for the jobs performed during the workweek, and dividing that total by the number of hours worked. If the resultant regular rate is below the minimum wage, the employer would have to make up the shortfall. Of course, if additional payments such as bonuses are made, those would have to be added to the daily-rate or job-rate earnings before dividing by the number of hours worked. The total daily-rate or job-rate earnings represent straight-time pay for all hours worked, meaning that overtime hours have to be compensated at only half of the regular rate.

As with any other pay method, the day or job rate method may in no case result in less than minimum wage for all hours actually worked, plus time and a half for hours worked in excess of 40 in a workweek.

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