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16) For overtime pay Which one is included in the regular rate?

A. Discretionary bonuses
B. Nondiscretionary bonuses
C. Gifts
D. Reimbursed expenses

1 Answer

1 vote

Final answer:

For overtime pay calculations, nondiscretionary bonuses are included in the regular rate, whereas discretionary bonuses, gifts, and reimbursed expenses are not.

Step-by-step explanation:

The question relates to what components of compensation are included when calculating the regular rate for overtime pay. Specifically, among the options listed, nondiscretionary bonuses are included in the calculation of the regular rate for overtime purposes. Nondiscretionary bonuses are those that are announced to employees to encourage them to work more steadily, rapidly, or efficiently, and the amounts of which are determined according to a formula based on hours worked, productivity, or efficiency. Unlike discretionary bonuses, which are determined at the employer’s discretion and are not expected by employees as part of their wages, nondiscretionary bonuses are considered part of an employee's regular rate when calculating overtime.

Discretionary bonuses, gifts, and reimbursed expenses are not included in the regular rate for overtime. These are forms of supplemental pay, which can also include items like insurance, health benefits, retirement and savings plans, both defined benefit and defined contribution, and other legally required benefits as outlined in the U.S. Bureau of Labor Statistics report "Table 6.7 Hourly Compensation: Wages, Benefits, and Taxes in 2014".

answered
User Holland Risley
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