Finance
Overtime pay calculator
Overtime is simple arithmetic that goes wrong surprisingly often, usually because the base rate is not what people think it is.
How overtime is built
Overtime pay has three parts: the hours below the threshold at your normal rate, the hours above it at a multiplied rate, and sometimes a separate band at double time for holidays or a seventh consecutive day. The calculator keeps them apart because payslips do, and because that is where errors become visible.
"Time and a half" means 1.5 times the regular rate for the overtime hours only — not for the whole week. Forty-six hours at $18.50 with time and a half is 40 × $18.50 plus 6 × $27.75, which is $906.50, not 46 × $27.75.
The regular rate is not always your hourly rate
This is where most genuine underpayments happen. In many jurisdictions — notably under the US Fair Labor Standards Act — overtime must be calculated on the regular rate of pay, which includes non-discretionary bonuses, shift differentials, and commission, not just the base hourly figure.
Someone paid $18.50 an hour plus a $200 production bonus for a 46-hour week has a regular rate above $18.50, and their overtime premium should be calculated on the higher figure. If your pay includes regular bonuses or shift premiums, the number to enter above is the blended rate: total straight-time earnings divided by total hours.
Thresholds vary more than people expect
Forty hours a week is the common threshold, but it is not universal. Some jurisdictions apply a daily threshold — California requires overtime beyond 8 hours in a day and double time beyond 12, regardless of the weekly total. Some collective agreements set 37.5 or 35 hours. Some contracts pay overtime only beyond contracted hours rather than a statutory figure.
The threshold field is editable for exactly that reason. If you are paid on a daily rule, run the calculation day by day rather than weekly, or the weekly total will hide overtime you are owed.
What does not count towards hours
Unpaid meal breaks generally do not count as hours worked, while short rest breaks usually do. Paid holiday and sick leave typically do not count towards the overtime threshold even though they are paid, because the threshold is about hours actually worked. That is why a week with one public holiday and 40 worked hours often produces no overtime despite 48 paid hours appearing on the slip.
Common questions
What does time and a half mean?
The overtime hours are paid at 1.5 times the regular rate. Only the hours beyond the threshold get the premium — the hours below it stay at the normal rate.
Is overtime calculated on my base hourly rate?
Not always. Many jurisdictions require it to be based on the regular rate of pay, which includes non-discretionary bonuses, shift differentials and commission. If your pay has those, divide total straight-time earnings by total hours and enter that blended figure.
Does paid holiday count towards the overtime threshold?
Usually not. Most rules count hours actually worked, so a week containing a paid public holiday and 40 worked hours typically produces no overtime, even though 48 hours appear as paid on the payslip.
What if my overtime is daily rather than weekly?
Run the calculation one day at a time using a daily threshold, such as 8 hours. A weekly total can conceal daily overtime — 4 days of 10 hours is 40 hours a week but 8 hours of daily overtime in some jurisdictions.