How the regular rate of pay works
Your regular rate is not always your posted hourly wage. Under federal wage law it is everything you earned in the workweek divided by every hour you actually worked, which means a production bonus or a commission quietly raises the rate your overtime is calculated on.
Legal basis: 29 C.F.R. §778.109 defines the regular rate as total remuneration for employment in a workweek divided by total hours worked, and 29 U.S.C. §207(a) requires at least one and one half that rate for hours over 40. Nondiscretionary bonuses, shift differentials and commissions must be included (29 C.F.R. §778.208), while genuinely discretionary bonuses, gifts and paid time off are excluded (§778.211 and §778.218). Because the straight-time pay already covers all hours worked, only the extra half-time premium is added for the overtime hours. Figures are current as of September 2026.
State rules can be more generous, and some states require daily overtime. This calculator is for reference only and is not legal advice. Consult a licensed attorney about your specific situation.
Frequently Asked Questions
When the weekly salary or piece rate already pays straight time for every hour worked, the law requires only the additional one half of the regular rate for hours past 40.
A nondiscretionary bonus does. It must be added into total earnings and can require recalculating the regular rate and paying retroactive overtime for the weeks it covers.
Truly discretionary bonuses, gifts, reimbursed expenses and pay for time not worked such as vacation or holidays are excluded under 29 C.F.R. §778.216 through §778.224.