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Regular rate of pay: how bonuses change overtime
Overtime is 1.5 times your regular rate, not your base rate. The regular rate is all straight-time pay for the workweek — including non-discretionary bonuses — divided by all hours worked, so a bonus raises the pay for every overtime hour that week.
The Department of Labor’s own example
29 CFR 778.110 works through a $12-an-hour employee who works 46 hours. Without a bonus the week pays $588.00: 46 hours at $12 plus 6 hours at $6. Add a $46 production bonus and the regular rate becomes $598 ÷ 46 = $13.00, so the same week pays $637.00 — 46 hours at $13 plus 6 hours at $6.50. The calculator reproduces both figures exactly, and they are part of its test suite.
The same regular rate sets the federal deduction: ½ × $13.00 × 6 hours = $39.00 of qualified overtime that week, not the $36.00 the base rate alone would give.
What goes in, what stays out
In: hourly wages, piece-rate and commission earnings, shift differentials, and bonuses promised in advance or tied to hours worked, production, attendance or staying with the employer — anything you expect because you met a condition.
Out: truly discretionary bonuses where both the fact and the amount are up to the employer, gifts for special occasions, expense reimbursements, pay for vacation, holiday or sick time not worked, and premium pay that is itself at least time and a half for weekend or holiday work.
Enter in-scope extra pay in the calculator’s “bonus or extra pay this week” box. A bonus that covers several weeks has to be spread back over those weeks, which the one-week calculator does not do.
California’s flat-sum bonus rule
California’s Labor Commissioner divides a flat-sum bonus by the regular, non-overtime hours in the period and pays overtime on it at the full 1.5× or 2×; a production bonus is divided by all hours and earns an extra half. For a $20 worker with a $100 bonus and five 10-hour days (40 regular hours, 10 daily overtime hours):
| Bonus treated as | Overtime premium | Week’s pay |
|---|---|---|
| Production bonus (all hours) | $110.00 | $1,210.00 |
| Flat-sum bonus (regular hours) | $137.50 | $1,237.50 |
The federal deduction always uses the FLSA method: in both cases it is $110.00. See the California overtime calculator.