HR Compliance Update – Colorado Includes Holiday Incentive Pay in Regular Rate of Pay Calculation

by | Oct 8, 2024

The Supreme Court of Colorado recently ruled that holiday incentive pay (extra pay for hours worked on a company holiday) is a type of shift differential compensation, and therefore must be included in the calculation of an employee’s regular rate of pay (RROP) for overtime purposes.

This is different from federal law, which doesn’t require that extra compensation for work on holidays—if paid at a premium rate of at least 1.5x an employee’s usual rate of pay—be included in the RROP calculation.

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