FLSA Overtime Calculator Advisor

"Premium" Pay

Certain premium payments made by employers for work in excess of or outside of specified daily or weekly standard work periods or on certain special days are regarded as overtime premiums. The extra compensation provided by the premium rates may be excluded from the overtime pay calculation if it meets all of the requirements listed in the regulations. Briefly, these premium payments are:

• Extra compensation paid at a “premium rate” for certain hours worked by an employee because such hours are hours worked in excess of eight in a day, or in excess of 40 hours in the week, or in excess of the employee’s normal working hours or regular working hours, as the case may be. Such extra compensation may be creditable toward overtime compensation. (29 CFR 778.202)
• Extra compensation provided by a “premium rate” for work by the employee on Saturdays, Sundays, holidays, or regular days of rest, or on the sixth or seventh day of the workweek. The premium rate may not be less than one and one-half times the rate established in good faith for work performed in nonovertime hours on other days. Such extra compensation may be creditable toward overtime compensation. (29 CFR 778.203, 29 CFR 778.205)
• Extra compensation provided by a “premium rate” under an applicable employment contract or collective bargaining agreement for work outside of the hours established in good faith by the contract or agreement as the basic, normal, or regular workday (not exceeding eight hours) or workweek (not exceeding 40 hours). The premium rate may not be less than one and one-half times the rate established in good faith by the contract or agreement for like work performed during the workday or workweek. Such extra compensation may be creditable toward overtime compensation. (29 CFR 778.204, 29 CFR 778.206)

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