Which of the following is excluded from overtime calculation?

Which of the following is excluded from overtime calculation?

• A. Discretionary bonuses
• B. Overtime pay
• C. Base salary
• D. Health insurance benefits

Answer: (A)

Discretionary bonuses are indeed excluded from overtime calculations because they are not considered regular earnings. The Fair Labor Standards Act (FLSA) specifies that only payments made as part of an employee's standard earnings should be factored into overtime calculations. Discretionary bonuses are typically given at the employer's discretion and are not pre-established or expected, which places them outside the purview of regular compensation that contributes to overtime pay. In contrast, overtime pay itself is distinctly relevant to overtime calculations, as it represents additional compensation for hours worked beyond the standard full-time workweek. Base salary is part of the regular earnings used to determine overtime eligibility, since it is considered a consistent payment for work performed. Health insurance benefits, while an important component of employee compensation, do not affect the calculation of overtime pay, as they are not direct wages. Thus, discretionary bonuses appropriately stand out as the correct exclusion from overtime calculations.

Discretionary bonuses are indeed excluded from overtime calculations because they are not considered regular earnings. The Fair Labor Standards Act (FLSA) specifies that only payments made as part of an employee's standard earnings should be factored into overtime calculations. Discretionary bonuses are typically given at the employer's discretion and are not pre-established or expected, which places them outside the purview of regular compensation that contributes to overtime pay.

In contrast, overtime pay itself is distinctly relevant to overtime calculations, as it represents additional compensation for hours worked beyond the standard full-time workweek. Base salary is part of the regular earnings used to determine overtime eligibility, since it is considered a consistent payment for work performed. Health insurance benefits, while an important component of employee compensation, do not affect the calculation of overtime pay, as they are not direct wages. Thus, discretionary bonuses appropriately stand out as the correct exclusion from overtime calculations.