(a) Section 7(e). This subsection of the Act provides as follows:
As used in this section the ``regular rate'' at which an employee is
employed shall be deemed to include all remuneration for employment paid
to, or on behalf of, the employee, but shall not be deemed to include:
(1) Sums paid as gifts; payments in the nature of gifts made at
Christmas time or on other special occasions, as a reward for service,
the amounts of which are not measured by or dependent on hours worked,
production, or efficiency; [discussed in Sec. 778.212].
(2) Payments made for occasional periods when no work is performed
due to vacation, holiday, illness, failure of the employer to provide
sufficient work, or other similar cause; reasonable payments for
traveling expenses, or other expenses, incurred by an employee in the
furtherance of his employer's interests and properly reimbursable by the
employer; and other similar payments to an employee which are not made
as compensation for his hours of employment; [discussed in Secs. 778.216
through 778.224].
(3) Sums paid in recognition of services performed during a given
period if either, (a) both the fact that payment is to be made and the
amount of the payment are determined at the sole discretion of the
employer at or near the end of the period and not pursuant to any prior
contract, agreement, or promise causing the employee to expect such
payments regularly; or (b) the payments are made pursuant to a bona fide
profit-sharing plan or trust or bona fide thrift or savings plan,
meeting the requirements of the Secretary of Labor set forth in
appropriate regulations which he shall issue, having due regard among
other relevant factors, to the extent to which the amounts paid to the
employee are determined without regard to hours of work, production, or
efficiency; or (c) the payments are talent fees (as such talent fees are
defined and delimited by regulations of the Secretary) paid to
performers, including announcers, on radio and television programs;
[discussed in Secs. 778.208 through 778.215 and 778.225].
(4) Contributions irrevocably made by an employer to a trustee or
third person pursuant to a bona fide plan for providing old-age,
retirement, life, accident, or health insurance or similar benefits for
employees; [discussed in Secs. 778.214 and 778.215].
(5) Extra compensation provided by a premium rate paid for certain
hours worked by the employee in any day or workweek because such hours
are hours worked in excess of eight in a day or in excess of the maximum
workweek applicable to such employee under subsection (a) or in excess
of the employee's normal working hours or regular working hours, as the
case may be; [discussed in Secs. 778.201 and 778.202].
(6) Extra compensation provided by a premium rate paid for work by
the employee on Saturdays, Sundays, holidays, or regular days of rest,
or on the sixth or seventh day of the workweek, where such premium rate
is not less than one and one-half times the rate established in good
faith for like work performed in nonovertime hours on other
days; or [discussed in Secs. 778.203, 778.205, and 778.206].
(7) Extra compensation provided by a premium rate paid to the
employee, in pursuance of an applicable employment contract or
collective bargaining agreement, for work outside of the hours
established in good faith by the contract or agreement as the basic,
normal, or regular workday (not exceeding eight hours) or workweek (not
exceeding the maximum workweek applicable to such employee under
subsection (a)), where such premium rate is not less than one and one-
half times the rate established in good faith by the contract or
agreement for like work performed during such workday or workweek;
[discussed in Secs. 778.201 and 778.206].
(b) Section 7(h). This subsection of the Act provides as follows:
Extra compensation paid as described in paragraphs (5), (6), and (7)
of subsection (e) shall be creditable toward overtime compensation
payable pursuant to this section.
(c) Only the statutory exclusions are authorized. It is important to
determine the scope of these exclusions, since all remuneration for
employment paid to employees which does not fall within one of these
seven exclusionary clauses must be added into the total compensation
received by the employee before his regular hourly rate of pay is
determined.
Extra Compensation Paid for Overtime
