Regular Rate of Pay
Use the Regular Rate of Pay Calculator →What is Regular Rate of Pay?
The regular rate of pay is the baseline hourly rate used to calculate overtime compensation under the FLSA. For hourly workers it equals the standard hourly wage. For salaried workers it is calculated by dividing the weekly salary by the number of hours the salary is intended to cover.
The regular rate must include most forms of compensation - base wages, shift differentials, and non-discretionary bonuses - but excludes purely discretionary bonuses, overtime premiums already paid, and certain benefit payments.
When to use Regular Rate of Pay
Use the regular rate of pay when computing overtime for any worker whose compensation includes more than a simple hourly wage. If a worker earns a bonus, commission, or shift premium, these amounts are added to base wages before dividing by hours to determine the correct regular rate.
Worked examples
| Worker type | Weekly earnings | Hours | Regular rate |
|---|---|---|---|
| Hourly worker | $800 (40 hrs x $20) | 40 | $20.00/hr |
| Salaried non-exempt | $1,200 salary for 40 hrs | 40 | $30.00/hr |
| Hourly + $100 bonus | $900 total ($800 + $100) | 40 | $22.50/hr |
Common pitfalls
Many employers mistakenly calculate overtime using base wage only, ignoring bonuses or shift differentials. This understates the regular rate and results in underpayment of overtime. The FLSA requires that most non-discretionary extra pay be factored in before the 1.5x multiplier is applied.
Frequently asked questions
How do you calculate the regular rate for a salaried worker?
Divide the weekly salary by the number of hours the salary covers. A $1,200 weekly salary for a 40-hour week gives a $30/hr regular rate. Overtime hours beyond 40 must then be paid at $45/hr (1.5x). The salary itself covers the first 40 hours; only the 0.5x premium is additional.
Does the regular rate include overtime premiums already paid?
No. Overtime premiums already paid (the extra 0.5x above base rate) are excluded when computing the regular rate. This prevents double-counting. Also excluded: discretionary bonuses, vacation or sick pay, and reimbursements for expenses.