Incentive Pay

​In some businesses, tips and gratuities make up part of employees’ pay in addition to wages. In other businesses, piece rates, commissions and bonuses make up all or part of employees’ pay. Understanding the distinctions between these types of pay is important because certain wage and hour laws contain exceptions for incentive pay (for example, timing of wage payments, final wages and exemptions from overtime) and determine whether and when payment of these types of wages is due.