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OT + Incentive in California

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  • OT + Incentive in California

    What is the relationship between paying overtime and incentive payouts if employees hit incentive targets? For example, if an employee who is scheduled to work 8 hrs at $10/hr works 12 hours on a particular day and hits production targets that pay $1 extra, how does the employee get paid out for the 4 hrs overtime and incentive amount?

  • #2
    Overtime and Incentive

    Are you exempt? Exempt employees are not eligible for overtime. However, non-exempt employees who receive a production bonus are eligible for an overtime rate calculated on the combination of the hourly rate plus the production bonus.

    What is a production bonus? If you are working under a specific formula for the incentive; for example, you are told in advance that you you get an additional $1.00 for each sale you make, then that is a production bonus. Christmas bonuses and one-time special awards are not added into the calculation of overtime.

    Let me know if you have any other questions. I won't answer your other posts, unless they are different than this one. THanks.
    Lillian Connell

    Forum Moderator
    www.laborlawtalk.com

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    • #3
      OT + Incentive Payout in California

      I am talking about non-exempt production workers. The efficiency formula is $1 if employees hit the 90% target. If they do, how will the total payout be calculated based on this example here?

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      • #4
        Overtime

        The $1 would be added to your basic rate and then multiplied by 1.5 to get the overtime rate.
        Lillian Connell

        Forum Moderator
        www.laborlawtalk.com

        Comment

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