Overtime is one and a half times your regular rate, which is not simply your base hourly figure. The regular rate includes nondiscretionary bonuses, shift differentials, commissions and most other earnings, divided by all hours worked that week. Excluding a production bonus from the calculation understates every overtime hour it should have covered.
The regular rate is a calculation, not a number on your contract
Take everything you earned for the week that counts, divide by the hours you actually worked, and that is the regular rate. Overtime hours are then paid at one and a half times it.
What goes in
Nondiscretionary bonuses — anything announced in advance to encourage output, attendance or quality. Shift differentials for nights and weekends. Commissions. Piece rates. On-call payments. Most of these are omitted routinely.
What stays out
Genuinely discretionary bonuses decided after the fact with no promise attached. Gifts. Paid time off, holiday and sick pay, because it is not payment for hours worked. Reimbursed expenses.
Employers frequently call a bonus discretionary when it was announced in advance against a target, which makes it nondiscretionary whatever it is labeled.
The retroactive part people miss
A quarterly bonus has to be spread back across the weeks it was earned in, and overtime recalculated for each of them. That produces a small extra payment for every overtime hour in the quarter, and it is very commonly skipped.
The workweek stands alone
A fixed, recurring period of 168 hours. Fifty hours one week and thirty the next is ten hours of overtime, not zero — averaging across two weeks is not permitted for most employees.
Checking your own
Add every payment for the week that counts, divide by hours worked, multiply by 0.5, and multiply by your overtime hours. That is the premium you should see on top of straight time for those hours. If a bonus week produces the same overtime figure as a non-bonus week, the regular rate was not recalculated.
Common questions
Is overtime just 1.5 times my hourly rate?
Not necessarily. It is 1.5 times your regular rate, which includes bonuses, shift differentials and commissions divided by hours worked.
Which bonuses count?
Nondiscretionary ones — anything announced in advance for output, attendance or quality. Labeling it discretionary afterwards does not change that.
Does paid time off count toward the regular rate?
No. Holiday, sick and vacation pay are not payment for hours worked and stay out of the calculation.
What happens with a quarterly bonus?
It must be spread back across the weeks it was earned and overtime recalculated for each. This step is very commonly skipped.
Can my employer average two weeks?
No. The workweek is a fixed 168 hours and each stands alone, so fifty hours then thirty is ten overtime hours.