How to calculate overtime pay (time and a half, double time)

Overtime is usually paid at a premium: one and a half times the normal hourly rate (“time and a half”), or twice it (“double time”). The arithmetic is simple once you know your hourly rate, which salaried workers often have to work out first.

Worked example

You earn 18 an hour, work 46 hours this week, and overtime starts after 40 hours at time and a half.

• Regular pay: 40 × 18 = 720
• Overtime rate: 18 × 1.5 = 27
• Overtime pay: 6 × 27 = 162
• Total for the week: 720 + 162 = 882

At double time, the overtime rate would be 36 and the overtime pay 216, for a total of 936.

If you are paid a salary

Turn the salary into an hourly rate first. Annual salary ÷ (contracted hours per week × 52) gives the hourly figure. The Salary Calculator does it for you using your hours per week and days per week: enter the annual figure and read the hourly rate. For example, 39,000 a year at 37.5 hours a week is 20 an hour, so time and a half is 30.

Partial hours

Convert minutes to a decimal before multiplying: 45 minutes is 0.75 of an hour, so 2 hours 45 minutes of overtime is 2.75 hours. The guide to converting minutes to decimal hours has a table. Multiplying 2.45 instead of 2.75 is a surprisingly common payslip error.

What the law says varies

• United States: under federal law, non-exempt employees must be paid at least time and a half for hours over 40 in a workweek. Some states add daily overtime rules.
• United Kingdom: there is no legal right to overtime pay; it depends on your contract. But your average pay for all hours worked must not fall below the minimum wage.
• India: the Factories Act requires overtime at twice the ordinary rate for covered workers; other employment depends on state law and contracts.

Check your contract, staff handbook or collective agreement for the threshold and the multiplier, and whether weekends and public holidays have their own rates.

Check your payslip

• Is the overtime threshold weekly or daily, and was it applied correctly?
• Were paid holidays or sick days counted towards the threshold? Contracts differ.
• Were partial hours converted to decimals correctly?
• Does the hourly rate include regular bonuses or allowances where the rules require it?

Is the overtime worth it?

Overtime is taxed as normal income, so a large overtime month can push part of your pay into a higher tax band for that period. Over the year it usually evens out, but the extra on a single payslip can be smaller than expected. To see how much extra pay changes your take-home, use the Take-Home Pay Calculator with and without it. For what an hourly rate means over a year, see converting hourly pay to annual salary.