Fundamental Payroll Certification Fundamental Payroll Core Payroll Concepts 3 — Questions and Answers
Question 1: Under the Fair Labor Standards Act (FLSA), non-exempt employees must be paid overtime at a rate of at least:
- 1.25 times their regular rate
- 1.5 times their regular rate (Correct answer)
- 2.0 times their regular rate
- 1.75 times their regular rate
Correct answer: 1.5 times their regular rate
The FLSA requires that covered non-exempt employees be paid at least 1.5 times (time-and-a-half) their regular rate for hours worked over 40 in a workweek.
Question 2: A non-exempt employee earns $18/hour and works 46 hours in a week. What is the total gross pay?
- $828.00
- $864.00
- $882.00 (Correct answer)
- $972.00
Correct answer: $882.00
(40 × $18) + (6 × $27) = $720 + $162 = $882.00; the 6 overtime hours are paid at 1.5× the regular rate.
Question 3: Under the FLSA, the standard workweek for overtime purposes is defined as:
- Any 7 consecutive days designated by the employer (Correct answer)
- Monday through Sunday only
- The calendar month
- Any 14-day period
Correct answer: Any 7 consecutive days designated by the employer
The FLSA defines a workweek as any fixed, regularly recurring period of 168 consecutive hours (7 consecutive 24-hour periods) established by the employer.
Question 4: Which category of workers is generally EXEMPT from FLSA overtime requirements?
- Hourly retail clerks earning $8/hour
- Salaried executive managers earning $684+/week (Correct answer)
- Part-time warehouse workers
- Hourly food service employees
Correct answer: Salaried executive managers earning $684+/week
The FLSA white-collar exemptions cover executive, administrative, and professional employees who are paid on a salary basis of at least $684/week and meet specific duties tests.
Question 5: A tipped employee who earns $2.13/hour in direct wages must receive enough tips to bring their total to at least:
- $5.12/hour
- $7.25/hour (Correct answer)
- $10.00/hour
- $8.00/hour
Correct answer: $7.25/hour
Under the FLSA, if tips do not bring the employee's total hourly earnings to the federal minimum wage of $7.25/hour, the employer must make up the difference.
Question 6: Which of the following correctly describes how commissions are treated for overtime calculation under the FLSA?
- Commissions are always excluded from the regular rate
- Commissions earned in the workweek are included in the regular rate (Correct answer)
- Commissions are paid separately and exempt from overtime
- Commissions replace the regular rate entirely
Correct answer: Commissions earned in the workweek are included in the regular rate
Non-discretionary commissions earned in the workweek must be included in the regular rate of pay when calculating overtime under the FLSA.
Question 7: An employee is paid $600 weekly salary plus a $150 non-discretionary bonus. Their regular rate for overtime purposes is:
- $15.00/hour
- $18.75/hour (Correct answer)
- $16.25/hour
- $18.00/hour
Correct answer: $18.75/hour
Total compensation = $600 + $150 = $750; regular rate = $750 ÷ 40 hours = $18.75/hour.
Fundamental Payroll Certification Fundamental Payroll Core Payroll Concepts 3
Under the Fair Labor Standards Act (FLSA), non-exempt employees must be paid overtime at a rate of at least: