Premium pay is additional pay provided to employees for working certain types of hours or under certain types of conditions, as authorized under Title 5, United States Code (U.S.C.) chapter 55, subchapter V, and Title 5, Code of Federal Regulations (CFR) part 550, subpart A. Premium pay paid under Title 5 is subject to certain biweekly or annual pay limitations.
Premium pay includes pay authorized under Title 5 for overtime, night, Sunday, or holiday work; or for standby duty, administratively uncontrollable overtime work, or availability duty. It also includes the dollar value of earned hours of compensatory time off for Fair Labor Standards Act (FLSA) exempt (not covered) employees.
Premium pay excludes overtime pay and compensatory time off in lieu of overtime pay earned by FLSA non-exempt (covered) employees. Also, compensatory time off for travel and for religious observances, as well as credit hours and hazardous duty pay, are not considered to be premium payments for either FLSA exempt or non-exempt employees, and, therefore, are not subject to the biweekly and annual limitations on premium pay.
Authorization of Premium Pay
Generally, work involving premium pay should be ordered or authorized in advance. The head of each operating unit and other appointing officers designated in Department Administrative Order, 202-250, “Delegations of Authority for Human Resources Management,” Appendix A, have the authority to approve premium pay. This authority may be redelegated to the extent deemed practical, and should be in writing.
Work schedules may not be changed specifically to include or exclude an employee from entitlement to premium pay or to increase or decrease such entitlements.
Authorization of Overtime Pay under Title 5
Overtime work must be authorized in writing, must be officially ordered or approved (5 CFR
§ 550.111), and should be approved in advance. However, overtime may be approved retroactively (normally not later than the next workday) where compelling reasons make it impossible or impracticable to obtain prior approval.
Supervisors/managers designated to authorize overtime may not authorize overtime for themselves.
The Department of Commerce’s (DOC) automated time and attendance (T&A) system (i.e. webTA) has a webTA Leave and Premium Pay module that should be used to request and authorize overtime work. When the T&A system is not available, Form CD-81, “Authorization for Paid Overtime and/or Holiday Work, and for Compensatory Overtime,” or other documentation such as an email are acceptable. All forms of authorization outside of the
DOC-automated T&A system must be retained by the authorizing official for a period of 6 years, as this documentation is required to support time and attendance recordings.
Reviewed by OHRM, June 2020
References: 5 U.S.C. chapter 55, subchapter V; 5 CFR part 550, subpart A; and
5 CFR § 550.111