If the employee makes $10.00 per hour, then the overtime rate is $15.00 per hour [1 ½ times $10.00 = $15.00]. Now we need to calculate Jane’s “regular rate,” which is her straight-time pay divided by the number of … Calculate Regular Rate. Yes, all shift differential pay must be included in the calculation of the regular rate of pay used to compute an employee's overtime rate. Here’s an example: A personal care assistant at an assisted living facility is paid $8 an hour and overtime on the basis of the 40 hour workweek standard. Employers must include shift differential pay when determining an employee’s regular rate of pay. Shift bonuses and shift differentials must be included when calculating overtime pay. premium payments other than for overtime, such as night shift pay differentials and premiums paid for hazardous, arduous, or dirty work. The regular rate of pay in terms of the FLSA is not the same as the base rate or the pay an employer regularly pays an employee. and dividing by the total number of hours worked. The most frequently offered type of differential pay is given for specific work shifts and is common in the manufacturing industry. The regular rate of pay is calculated by determining the staff member's total pay for the workweek, including base rate, shift differential pay, etc. Employees can also receive flat rate shift differentials. It can even include meals! It may include shift differentials and other variable rates of pay as well. An effective practice used by many U.S. employers is using shift differentials—pay premiums to compensate employees for working shifts other than regular weekday hours. Certain payments or benefits you receive are not included in your regular rate of pay. But some types of pay are excluded from the regular rate, like a narrow type of discretionary bonus and gifts, holiday or vacation pay, and certain benefits. These include: premium payments for overtime work or extra pay for work on Saturdays, Sundays, and holidays It includes hourly compensation, and also other types of pay like bonuses and commissions. It includes base pay, on-call pay, shift differentials, premium pay, stipends, and nondiscretionary lump-sum payments. Employers may soon have some clarity on which perks must be included in workers' "regular rate" of pay, which is used to calculate overtime premiums under federal law. 2. They make an additional $1.00 per hour. Overtime pay is 1 ½ times the employee’s “Regular Rate.” In many situations, the “Regular Rate” is simply the hourly pay rate. Many employers utilize incentive pay wherein an employee is paid an extra amount of money on top of his or her normal hourly rate. The regular rate of pay often is a complex formula that includes all “remuneration” provided for hours worked, such as hourly pay, shift differentials, salaries, piece rates, commissions, and most bonuses. Some reasons for differential pay practices may include shift work, call-back work, weekend work and hazardous or dirty duty. Let’s say a customer support employee works third shift. If the employee works 30 hours in a week, that is an additional $30 they earn per week (30 x $1.00). 2 nights x 8 hours per night x $2 per hour (shift differential) = $32; Without overtime wages, Jane should get $640 plus $320 plus her shift differential of $32, for a total of $992. Wherein an employee is paid an extra amount of money on top of his or her normal hourly.., premium pay, shift differentials, premium pay, shift differentials and other variable rates of pay an practice. Shift differentials and premiums paid for hazardous, arduous, or dirty work, such night. 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