Important Terms and Definitions

The following definitions are provided to aid in the discussion of alternative overtime:

Term	Definition
Alternative rate	The calculated rate used as the basis for determining the overtime payment. The alternative rate is calculated as (regular period pay + overtime pay at contractual + total other FLSA eligible earnings) / total FLSA eligible hours. Note: If the employee is eligible for alternative overtime, the alternative rate replaces the FLSA rate subject to the FLSA rule setting on the Company table.

Term

Definition

Alternative rate

The calculated rate used as the basis for determining the overtime payment. The alternative rate is calculated as (regular period pay + overtime pay at contractual + total other FLSA eligible earnings) / total FLSA eligible hours.

Note: If the employee is eligible for alternative overtime, the alternative rate replaces the FLSA rate subject to the FLSA rule setting on the Company table.

Term	Definition
Contractual rate	Equivalent to the hourly rate or compensation rate.
Premium rate	The extra amount of the contractual rate paid for overtime, stated as a percentage. For example, if overtime is 1.5 times the contractual rate, the premium rate is 50 percent.
Premium amount	The premium amount paid for alternative overtime is paid at the higher of the contractual rate or the alternative rate.