Compensation Glossary

Fee Basis

Under FLSA, administrative and professional employees may be paid on a fee basis. An employee will be considered to be paid on a ‘‘fee basis’’ within the meaning of these regulations if the employee is paid an agreed upon sum for a single job regardless of the time required for its completion. These payments resemble piecework payments with the important distinction that generally a ‘‘fee’’ is paid for the kind of job that is unique rather than for a series of jobs repeated an indefinite number of times and for which payment on an identical basis is made over and over again. Payments based on the number of hours or days worked and not on the accomplishment of a given single task are not considered payments on a fee basis. (Section 541.605)