For the first time in 50 years, the DOL has put in place a new definition of “regular rate of pay,” (RROP) which determines how an employee's overtime pay is calculated.
Last week, the Department of Labor published a new rule regarding overtime pay that it says will encourage employers to offer employees more perks.
For the first time in 50 years, the DOL has put in place a new definition of “regular rate of pay,” (RROP) which determines how an employee's overtime pay is calculated. Workers who are eligible for overtime are required to be paid 1.5 times the RROP when they work more than 40 hours per week.
Where it gets complicated is that the RROP does not simply refer to a worker's base hourly wage. It can also include bonuses, shift differential wages or other incentive payments. An employee's overtime pay is therefore supposed to take all of those additional forms of compensation into account.
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