Unless specifically noted, payments that are excluded from the regular rate may not be credited towards overtime compensation due under the FLSA. §§ 207(e)(1) and (3) contain statutory provisions which address the excludability of certain bonuses. The Act provides an exhaustive list of payments that may be excluded from the regular rate of pay. Under the FLSA, all compensation for hours worked, services rendered, or performance is included in the regular rate of pay. Fact Sheet #23 provides additional information regarding overtime pay.Ī bonus is a payment made in addition to the employee’s regular earnings. The amount of overtime pay due to an employee is based on the employee’s regular rate of pay and the number of hours worked in a workweek regardless of whether the employee is paid on a piece rate, day rate, commission, or a salary basis. Fact Sheet #22 provides general information about determining hours worked.

The FLSA requires that most employees in the United States be paid at least the federal minimum wage for all hours worked and overtime pay at not less than time and one-half the regular rate of pay for all hours worked over 40 hours in a workweek. For information regarding nondiscretionary bonuses and employees employed as executive, administrative, professional, or outside sales employees, who are exempt from the FLSA’s minimum wage and overtime requirements, see Fact Sheet #17U. This fact sheet provides general information regarding bonuses and the regular rate of pay under the FLSA for non-exempt employees.

Fact Sheet #56C: Bonuses under the Fair Labor Standards Act (FLSA)

Bonus s