for accrued compensatory time earned after April 14, 1986, may be made
at any time and shall be paid at the regular rate earned by the employee
at the time the employee receives such payment.
termination of employment, an employee shall be paid for unused
compensatory time earned after April 14, 1986, at a rate of compensation
not less than--
(1) The average regular rate received by such employee during the
last 3 years of the employee's employment, or
(2) The final regular rate received by such employee, whichever is
(c) The phrase
last 3 years of employment means the 3-year period immediately prior to
termination. Where an employee's last 3 years of employment are not
continuous because of a break in service, the period of employment after
the break in service will be treated as new employment. However, such a
break in service must have been intended to be permanent and any accrued
compensatory time earned after April 14, 1986, must have been cashed out
at the time of initial separation. Where the final period of employment
is less than 3 years, the average rate still must be calculated based on
the rate(s) in effect during such period.
(d) The term
``regular rate'' is defined in 29 CFR 778.108. As indicated in Sec.
778.109, the regular rate is an hourly rate, although the FLSA does not
require employers to compensate employees on an hourly basis.
[52 FR 2032, Jan.
16, 1987; 52 FR 2648, Jan. 23, 1987]