The effect of section 7(e)(7) where ``clock pattern'' premiums are
paid may be illustrated by reference to provisions typical of the
applicable collective bargaining agreements traditionally in effect
between employers and employees in the longshore and stevedoring
industries. These agreements specify straight time rates applicable
during the hours established in good faith under the agreement as the
basic, normal, or regular workday and workweek. Under one such
agreement, for example, such workday and workweek are established as the
first 6 hours of work, exclusive of mealtime, each day, Monday through
Friday, between the hours of 8 a.m. and 5 p.m. Under another typical
agreement, such workday and workweek are established as the hours
between 8 a.m. and 12 noon and between 1 p.m. and 5 p.m., Monday through
Friday. Work outside such
workday and workweek is paid for at premium rates not less than one and
one-half times the bona fide straight-time rates applicable to like work
when performed during the basic, normal, or regular workday or workweek.
The extra compensation provided by such premium rates will be excluded
in computing the regular rate at which the employees so paid are
employed and may be credited toward overtime compensation due under the
Act. For example, if an employee is paid $5 an hour under such an
agreement for handling general cargo during the basic, normal, or
regular workday and $7.50 per hour for like work outside of such
workday, the extra $2.50 will be excluded from the regular rate and may
be credited to overtime pay due under the Act. Similarly, if the
straight time rate established in good faith by the contract should be
higher because of handling dangerous or obnoxious cargo, recognition of
skill differentials, or similar reasons, so as to be $7.50 an hour
during the hours established as the basic or normal or regular workday
or workweek, and a premium rate of $11.25 an hour is paid for the same
work performed during other hours of the day or week, the extra $3.75
may be excluded from the regular rate of pay and may be credited toward
overtime pay due under the Act. Similar principles are applicable where
agreements following this general pattern exist in other industries.
[46 FR 7311, Jan. 23, 1981]
