Static educational checklist — not a calculator. No plan-funding inputs, no profit-pool engines, no live regular-rate math. Spot common FLSA § 778.213 profit-sharing, thrift, and savings plan red flags: when sums paid under a bona fide Part 549 profit-sharing plan or Part 547 thrift / savings plan may stay out of the regular rate under section 7(e)(3)(b), when non-qualifying “profit shares,” cash-in-lieu, or wage substitutes must stay in, and when payroll collapses those extras with § 778.215 benefit-plan contributions, § 778.211 discretionary bonuses, § 778.209 nondiscretionary inclusions, § 778.210 percentage bonuses, or § 778.212 gifts. Distinct from the benefit-plan (§ 778.215), discretionary-bonus (§ 778.211), gifts (§ 778.212), and premium-credit cheat-sheet pages.
Baseline — what § 778.213 covers (and does not)
Under 29 CFR § 778.213, FLSA section 7(e)(3)(b) provides that the regular rate shall not be deemed to include “sums paid in recognition of services performed during a given period if … the payments are made pursuant to a bona fide profit-sharing plan or trust or bona fide thrift or savings plan, meeting the requirements of the Secretary of Labor set forth in appropriate regulations.” Such sums may not be credited toward overtime compensation due under the Act. The governing regulations are 29 CFR Part 549 (profit-sharing plans / trusts) and Part 547 (thrift or savings plans). Payments in addition to regular wages, made pursuant to a plan that meets Part 547 or Part 549, are properly excluded from the regular rate. Payments that fail those gates — including ad hoc profit “shares,” attendance / production bonuses labeled profit-sharing, or cash paid outside a qualifying written plan — remain remuneration that belongs in the regular-rate analysis (often under § 778.209 / § 778.211 / § 778.210). This page does not compute plan payments or regular rates — it only flags compliance red flags.
Checklist — profit-sharing / thrift / savings red flags
Non–Part 549 / Part 547 “profit-sharing” or “thrift” payments wrongly excluded from the regular rate. Flag year-end “profit share,” “savings match,” or “thrift distribution” GL codes stripped from the regular-rate numerator when there is no written plan meeting Part 549 (profit-sharing) or Part 547 (thrift / savings) — missing definite formula, missing profit / thrift character, or missing employee communication. A GL name is not a bona fide plan.
True bona fide Part 549 / Part 547 payments stuffed into the regular-rate numerator. Flag worksheets that fold qualifying profit-sharing distributions or thrift / savings plan payments into the FLSA regular rate when the plan actually meets the Secretary’s regulations. A blanket “everything goes into RR” macro does not cure a qualifying § 778.213 exclusion.
§ 778.213 plan payments wrongly credited toward statutory overtime due. Flag settlement sheets that apply profit-sharing / thrift / savings distributions as a credit against FLSA overtime premiums owed for hours actually worked over 40. Exclusion from the regular rate and non-creditability toward OT track together under § 778.213 — using the plan payment as an OT offset underpays.
Collapse with § 778.215 benefit-plan contributions (section 7(e)(4)). Flag one “BENEFITS / PROFIT / THRIFT” bucket used for (i) true § 778.213 profit-sharing / thrift / savings payments and (ii) employer contributions to retirement / medical / unemployment plans under § 778.215. Related doctrines, different statutes and regs — 7(e)(3)(b) + Parts 549/547 vs 7(e)(4) + § 778.215’s plan / purpose / irrevocable-funding tests.
Collapse with § 778.211 discretionary / § 778.209 nondiscretionary bonuses. Flag “profit-sharing” labels on promised quarterly bonuses, expected year-end awards, or manager-discretion pools that never meet Part 549 / 547. Discretionary vs nondiscretionary character is a § 778.211 / § 778.209 question — not a shortcut around the bona fide plan gate.
Collapse with § 778.210 percentage-of-total-earnings bonuses. Flag percentage-of-earnings “profit shares” that already carry overtime under § 778.210’s method, then also stripped (or double-handled) under a § 778.213 label. A true § 778.210 percentage bonus is paid as part of earnings; a qualifying § 778.213 plan payment is excluded from the regular rate and may not be credited toward OT — different mechanics.
Collapse with § 778.212 gifts / Christmas / special-occasion bonuses. Flag December “profit gifts,” tenure “thrift awards,” or holiday “savings shares” coded to force a § 778.212 gift exclusion (or the reverse) without running either test. Gift character (§ 778.212) and bona fide profit-sharing / thrift character (§ 778.213) are easy to conflate on a year-end stub.
Cash-in-lieu, wage-substitute, or production / hours / efficiency “profit shares.” Flag opt-out cash in place of thrift participation, hourly-rate top-ups labeled “profit share,” and amounts measured by hours worked, units produced, sales, attendance points, or efficiency scores while still excluded under § 778.213. Substance controls — a profit / thrift label does not convert ordinary wages or production bonuses into a Part 549 / 547 exclusion.
Evasion, unfunded bookkeeping “trusts,” and ad hoc manager pools. Flag informal year-end pools with no written plan, employer-retained diversion rights, contingent book entries never paid under a qualifying trust / plan, and arrangements structured to evade the Act while claiming § 778.213. Bona fide status under Parts 549 and 547 is a regulatory gate, not a marketing claim.
Stub coding and record gaps on profit-share vs thrift vs benefit vs bonus vs RR splits. Flag wage statements that never separate qualifying Part 549 / 547 distributions from base wages, nondiscretionary bonuses, § 778.215 benefit contributions, gifts, or true OT; missing plan-ID / distribution-reason codes; destroyed plan documents; and regular-rate worksheets that strip every “PROFIT / THRIFT / SAVINGS” code without a Part 549 / 547 analysis. Record gaps turn every year-end distribution into a he-said / she-said § 778.213 dispute.