Athena
In Shakespeare’s day, Pensioners were a group of noblemen close to the king or queen of England and who formed the honor guard. 
RALPH
They were called pensioners because they received a pension, meaning a regular payment for being in this group  
ATHENA
As part of the royal court, gentlemen-pensioners always wore fancy clothes.. 
Ralph
In this passage, the fairy is imagining the tall cowslip flowers as the Fairy Queen's honor guard.
Athena
The yellow petals are the Pensioners' coats, and the fragrant red dots on the leaves are rubies, just the sort of "favors", or gifts, a queen might give to her "favorites" at court. The Pensioners wore these favors on their coats to signify their closeness to the queen.
Ralph
The fairy also tells Puck she’s out collecting dewdrops from the grass so she can  hang them as pearl earrings on the guardsmen. 
ATHENA
In Shakespeare's time it was not uncommon for upper class men to wear earrings, as you can see in this painting of William Shakespeare himself.