(a) Employees engaged in or connected with the manufacture, fabrication, assembling, handling, supervision, or shipment of materials, supplies, articles, or equipment used in the performance of the contract may be employed in excess of 40 hours in any one week: Provided, Such persons shall be paid for any hours in excess of 40 hours in any one week the overtime rate of pay which has been set therefor by the Secretary of Labor.

(b) Until otherwise set by the Secretary of Labor the rate of pay for such overtime shall be one and one-half times the basic hourly rate received by the employee. The “basic hourly rate” means an hourly rate equivalent to the rate upon which time-and-one-half overtime compensation may be computed and paid under section 7 of the Fair Labor Standards Act of 1938, as amended. The basic hourly rate may, in no case, be less than the applicable minimum wage.

(c) If in any one week or part thereof an employee is engaged in work covered by the contract's stipulations, overtime shall be paid for any hours worked in excess of 40 hours in any one week at the overtime rate set forth in paragraph (b) of this section.

(d) The overtime pay requirements of this section shall be deemed to be complied with in the case of any employee employed as provided in section 7(b) of the Fair Labor Standards Act of 1938, as amended, pursuant to the provisions of paragraph (1) or (2) of that section.

[7 FR 4494, June 16, 1942, as amended at 18 FR 1832, Apr. 2, 1953. Redesignated at 24 FR 10952, Dec. 30, 1959, as amended at 51 FR 12266, Apr. 9, 1986. Further redesignated at 61 FR 40716, Aug. 5, 1996]