5 C.F.R. Subpart E—Overtime Pay Provisions
Title 5 - Administrative Personnel
Title 5: Administrative Personnel
PART 551—PAY ADMINISTRATION UNDER THE FAIR LABOR STANDARDS ACT
Subpart E—Overtime Pay Provisions
Source: 45 FR 85665, Dec. 30, 1980, unless otherwise noted.
Basic Provisions
§ 551.501 Overtime pay.
(a) An agency shall compensate an employee who is not exempt under subpart B of this part for all hours of work in excess of 8 in a day or 40 in a workweek at a rate equal to one and one-half times the employee's hourly regular rate of pay, except that an employee shall not receive overtime compensation under this part—
(1) On the basis of periods of duty in excess of 8 hours in a day when the employee receives compensation for that duty under 5 U.S.C. 5545(c)(1) or (2) or 5545b;
(2) On the basis of hours of work in excess of 8 hours in a day that are not overtime hours of work under §410.402 of this chapter, part 532 of this chapter and 5 U.S.C. 5544, or part 550 of this chapter;
(3) On the basis of hours of work in excess of 8 hours in a day for an employee covered by 5 U.S.C. 5544 for any hours in a standby or on-call status or while sleeping or eating;
(4) On the basis of hours of work in excess of 8 hours in a day for an individual who is not an employee, as defined in 5 U.S.C. 5541(2), for purposes of 5 U.S.C. 5542, 5543, and 5544;
(5) On the basis of hours of work in excess of 40 hours in a workweek for an employee engaged in fire protection or law enforcement activities when the employee is receiving compensation under 5 U.S.C. 5545(c)(1) or (2) or 5545b, or is not an employee (as defined in 5 U.S.C. 5541(2)) for the purposes of 5 U.S.C. 5542, 5543, and 5544;
(6) For hours of work that are not “overtime hours,” as defined in 5 U.S.C. 6121, for employees under flexible or compressed work schedules;
(7) For hours of work compensated by compensatory time off under §551.531 of this part; and
(8) For fractional hours of work, except as provided in §551.521 of this part.
(b) An employee's “workweek” is a fixed and recurring period of 168 hours—seven consecutive 24-hour periods. It need not coincide with the calendar week but may begin on any day and at any hour of a day. For employees subject to part 610 of this chapter, the workweek shall be the same as the administrative workweek defined in §610.102 of this chapter.
(c) In this subpart, “irregular or occasional overtime work” is overtime work that is not scheduled in advance of the employee's workweek.
(d) The maximum earnings limitations described in §§550.105, 550.106, and 550.107 of this chapter do not apply to overtime pay due the employee under this subpart.
[45 FR 85665, Dec 30, 1980, as amended at 56 FR 11060, Mar. 15, 1991; 56 FR 20343, May 3, 1991; 57 FR 59279, Dec. 15, 1992; 63 FR 64594, Nov. 23, 1998; 64 FR 69180, Dec. 10, 1999]
Overtime Pay Computations
§ 551.511 Hourly regular rate of pay.
(a) An employee's “hourly regular rate” is computed by dividing the total remuneration paid to an employee in the workweek by the total number of hours of work in the workweek for which such compensation was paid.
(b) “Total remuneration” includes all remuneration for employment paid to, or on behalf of, an employee except:
(1) Payments as rewards for service the amount of which is not measured by or dependent on hours of work, production, or efficiency (e.g., a cash award for a suggestion made by an employee and adopted by an agency);
(2) Reimbursements for travel expenses, or other similar expenses, incurred by an employee in furtherance of an agency's interest, which are not related to hours of work;
(3) Payments made in recognition of services performed during a given period, if both the fact that payment is to be made and the amount of the payment are determined at the sole discretion of the agency (i.e., discretionary cash awards or bonuses);
(4) Contributions by an agency to a fund for retirement, insurance, or similar benefits;
(5) Extra compensation provided by a premium rate paid for hours of work performed by an employee in excess of eight in a day, or in excess of the normal workweek applicable to the employee;
(6) Extra compensation provided by a premium rate paid for hours of work performed by an employee on a Sunday or a holiday where such premium rate is at least one and one-half times the employee's rate of pay for work performed in nonovertime hours on other days; or
(7) Extra compensation provided by a premium rate paid for hours of work performed by an employee outside his or her regular working hours, where such premium rate is at least one and one-half times the employee's rate of pay for work performed in nonovertime hours.
[45 FR 85665, Dec. 30, 1980, as amended at 52 FR 47688, Dec. 16, 1987, and 53 FR 27147, July 19, 1988; 56 20343, May 3, 1991; 64 FR 69180, Dec. 10, 1999]
§ 551.512 Overtime pay entitlement.
(a) An employee's overtime entitlement under this subpart includes:
(1) The straight time rate of pay times all overtime hours worked; plus
(2) One-half times the employee's hourly regular rate of pay times all overtime hours worked.
(b) An employee's “straight time rate of pay” is equal to the employee's rate of pay for his or her position (exclusive of any premiums, differentials, or cash awards or bonuses) except for an employee who is authorized annual premium pay under §550.141 or §550.151 of this chapter. For an employee who is authorized annual premium pay, straight time rate of pay is equal to basic pay plus annual premium pay divided by the hours for which the basic pay plus annual premium pay are intended.
(c) An employee has been paid in compliance with the overtime pay provisions of this subpart only if the employee has received pay at a rate at least equal to the employee's straight time rate of pay for all nonovertime hours of work in the workweek.
[45 FR 85665, Dec. 30, 1980, as amended at 64 FR 69181, Dec. 10, 1999]
§ 551.513 Entitlement to other forms of pay.
Overtime pay under this subpart shall be paid in addition to all pay, other than overtime pay, to which the employee is entitled under title 5, United States Code, or any other authority. An employee entitled to overtime pay under this subpart and overtime pay under any authority outside of title 5, United States Code, shall be paid under whichever authority provides the greater overtime pay entitlement in the workweek.
[57 FR 59280, Dec. 15, 1992]
§ 551.514 Nondiscretionary bonuses.
(a) When an employee earns a nondiscretionary cash award or bonus (as opposed to discretionary cash awards or bonuses as described in §551.511(b)(3)), the bonus must be taken into account in determining overtime pay for the period of time during which the bonus was earned. An agency may meet the overtime pay requirements for the bonus period by using one of the procedures described in paragraphs (b) and (c) of this section. The procedures in paragraphs (b)(1) and (b)(2) of this section calculate the additional overtime pay the employee is due. The procedures in paragraphs (b)(3), (c)(2), and (c)(3) of this section describe methods where the overtime pay requirements are met in the calculation or distribution of the bonus itself.
(b) Individual computation methods—(1) Week-by-week recomputation method. The agency may compute the additional overtime pay owed an employee by allocating the nondiscretionary bonus payable under the agency bonus plan to the weeks or hours during which it was earned and recomputing the employee's total remuneration, hourly regular rate, and overtime pay for each applicable workweek in the bonus period.
(2) Bonus hourly rate method. The agency may assume that an equal amount of the nondiscretionary bonus applies to each hour worked during the bonus period and derive a bonus hourly rate by dividing the employee's total bonus by the total number of hours worked by the employee during the bonus period. Then the agency may compute the employee's additional overtime pay by multiplying one-half of that bonus hourly rate by the total number of overtime hours worked by the employee during the bonus period.
(3) Percentage bonus method. An agency may establish a nondiscretionary bonus as a fixed percentage of total pay (i.e., pre-bonus total remuneration, including straight time pay for any overtime hours, plus any half-rate overtime pay under §551.512(a)(2)) to be earned by the employee during a future period of service. This method may not be used to circumvent any bonus limitations that might otherwise apply. At the agency's discretion, the portion of the bonus attributable to the employee's half-rate overtime pay under §551.512(a)(2) may be excluded in applying bonus limitations, since it can be viewed as constituting additional FLSA overtime pay. (This method does not apply to nondiscretionary bonuses established as a percentage of a segment of pay, such as ratings-based cash awards under §451.104(g) of this chapter that are expressed as a percentage of basic pay, excluding locality adjustments. To meet overtime pay requirements for these types of bonuses, use one of the methods described in paragraphs (b)(1) or (b)(2) of this section.)
(c) Group-based bonus distribution methods. (1) For employees who have earned nondiscretionary group cash awards or bonuses, payment of a bonus under one of the methods of distribution described in paragraphs (c)(2) and (c)(3) of this section is considered to be in full compliance with the overtime pay requirements of this subpart. These methods may not be used to circumvent any bonus limitations that might otherwise apply.
(2) Percentage method. (i) Identify the amount of the group bonus under the agency's bonus plan and the period of time during which it was earned;
(ii) Establish the group bonus as a percentage of the total pay (i.e., total remuneration before considering the group bonus, including straight time pay for any overtime hours, plus any half-rate overtime pay under §551.512(a)(2)) earned by employees in the group during the bonus period; and (iii) Multiply the percentage in paragraph (c)(2)(ii) of this section times each individual employee's total pay earned during the bonus period to determine each employee's share of the group bonus.
(3) Boosted hour method. (i) Identify the amount of the group bonus under the agency's bonus plan and the period of time during which it was earned;
(ii) Determine the total number of boosted hours for all employees under the group bonus plan by adding up the total number of hours of work by those employees (nonovertime and overtime hours) and increasing that sum by one-half of the total number of overtime hours;
(iii) Divide the amount of the group bonus by the total number of boosted hours for all employees under the group bonus plan to determine the amount of the bonus allocable to each hour; and (iv) Multiply this hourly bonus amount by the number of boosted hours credited to each individual employee in the bonus period to determine each employee's share of the group bonus.
[64 FR 69181, Dec. 10, 1999]
Fractional Hours of Work
§ 551.521 Fractional hours of work.
(a) An employee shall be compensated for every minute of regular overtime work.
(b) A quarter of an hour shall be the largest fraction of an hour used for crediting irregular or occasional overtime work under this subpart. When irregular or occasional overtime work is performed in other than the full fraction, odd minutes shall be rounded up or rounded down to the nearest full fraction of an hour used to credit overtime work.
[48 FR 36806, Aug. 15, 1983]
Compensatory Time Off
§ 551.531 Compensatory time off.
(a) At the request of an employee who is not exempt under subpart B of this part, the head of an agency (or designee) may grant compensatory time off from an employee's tour of duty instead of payment under §551.501 for an equal amount of irregular or occasional overtime work.
(b) At the request of an employee, as defined in 5 U.S.C. 2105, the head of an agency may grant compensatory time off from an employee's basic work requirement under a flexible work schedule under 5 U.S.C. 6122 instead of payment under §551.501 of this part for an equal amount of overtime work, whether or not irregular or occasional in nature.
(c) An agency may not require that an employee be compensated for overtime work under this subpart with an equivalent amount of compensatory time off from the employee's tour of duty. An employee may not directly or indirectly intimidate, threaten, or coerce, or attempt to intimidate, threaten, or coerce any other employee for the purpose of interfering with such employee's rights to request or not to request compensatory time off in lieu of payment for overtime hours.
(d) The head of an agency may fix time limits for an employee to request and take compensatory time off under this section. If compensatory time off is not requested or taken within the established time limits, the employee must be paid for overtime work at the overtime rate in effect for the work period in which it was earned under this subpart.
(e) The dollar value of compensatory time off when it is liquidated, or for the purpose of applying pay limitations, is the amount of overtime pay the employee otherwise would have received for the hours of the pay period during which compensatory time off was earned by performing overtime work.
[56 FR 20343, May 3, 1991, as amended at 62 FR 28307, May 23, 1997; 64 FR 69181, Dec. 10, 1999]
Special Overtime Pay Provisions
§ 551.541 Employees engaged in fire protection activities or law enforcement activities.
(a) An employee engaged in fire protection activities or law enforcement activities shall be paid at a rate equal to one and one-half times the employee's hourly regular rate of pay for those hours in a tour of duty which exceed the overtime standard for a work period specified in section 7(k) of the Act or which are in excess of 40 hours in a workweek for such an employee who does not receive compensation for those hours of work under 5 U.S.C. 5545 (c)(1) or (c)(2) or 5545b.
(b) The “tour of duty” of an employee engaged in these activities shall include all time the employee is on duty. Meal periods and sleep periods are included in the tour of duty except as otherwise provided in §§551.411(c) and 551.432(b) of this part.
(c) Each agency shall establish the “work period” to be used for application of section 7(k) of the Act. The work period shall be at least seven days and not more than 28 days.
(d) A firefighter subject to section 7(k) of the Act who is compensated under part 550, subpart M, of this chapter is deemed to be appropriately compensated under section 7(k) of the Act and this part if the requirements of §550.1304(a) of this chapter are satisfied. (See 5 U.S.C. 5545b(d)(2).)
[45 FR 85665, Dec. 30, 1980, as amended at 57 FR 59280, Dec. 15, 1992; 63 FR 64595, Nov. 23, 1998; 64 FR 69181, Dec. 10, 1999]
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