Estimate overtime pay from your hourly rate, hours and overtime multiplier.
Regular pay = rate × regular hours.
Overtime pay = rate × overtime multiplier × overtime hours.
Gross pay = regular pay + overtime pay.
This simple version does not include bonuses or other pay that may change the rate used for overtime, so check how your rules define the regular rate.
An employee earns $20 an hour and works 45 hours. Regular hours are 40 and overtime hours are 5 at 1.5. Regular pay is $800, overtime pay is 5 × $30 = $150 and gross pay is $950.
Federal overtime is half the regular rate on top of straight time, and the regular rate includes most bonuses. An employee who earns $18 an hour for 45 hours and a $90 attendance bonus has total pay of $900 before the premium. The regular rate is $900 ÷ 45 = $20, so the overtime premium for 5 hours is 5 × $10 = $50. Using only the $18 hourly rate would underpay by $5.
The federal rule counts hours over 40 in a workweek. A few states, among them California and Alaska, also pay overtime after a set number of hours in a day, and California adds double time at 12 hours. If your state has a daily rule, calculate each day first and then check the weekly total, paying whichever is higher.
| Day | Hours |
|---|---|
| Mon to Thu | 9 each |
| Fri | 6 |
| Total | 42 |
Run the calculation weekly, not at pay period end. A weekly view shows that an employee is at 38 hours on Thursday and lets the manager decide who covers Friday. If you pay biweekly, the two weeks are still calculated separately, so 50 and 30 hours means 10 overtime hours, not zero.
When someone works at two rates in the same week, such as $18 on the register and $22 as a shift lead, federal rules in 29 CFR 778.115 use a weighted average as the regular rate. The calculator above takes one rate, so work the average out first and enter it.
| Step | Figure |
|---|---|
| 30 hours at $18 | $540.00 |
| 15 hours at $22 | $330.00 |
| Straight-time pay for 45 hours | $870.00 |
| Regular rate: $870 ÷ 45 | $19.33 |
| Overtime premium: 5 hours × half of $19.33 | $48.33 |
| Total for the week | $918.33 |
Paying overtime at 1.5 times the lower $18 rate would come to $45 for the premium hours instead and underpay the employee. A written agreement can sometimes use the rate for the work done in the overtime hours instead, under 29 CFR 778.419, but it has to be in place before the work is done.
Under 29 CFR 778.105, a workweek is a fixed, regularly recurring period of 168 hours, seven consecutive 24-hour days. It can start on any day and hour you choose, such as Sunday at midnight, but it cannot be moved around to avoid overtime. Each workweek stands alone. A night shift that runs from Saturday 10 p.m. to Sunday 6 a.m. splits at the workweek boundary, with hours before midnight counting in one week and hours after it in the next.
EZTime can alert managers as an employee approaches an overtime threshold or a weekly hour limit, so the decision is made before the hours are worked.
No. It shows gross pay only.
The factor applied to the rate for overtime hours. Time and a half is 1.5.
It depends on federal, state and contract rules. Check with a professional.
Generally hours paid but not worked do not count toward overtime under federal law, though your policy or state may differ.
Only if they are non-exempt. Pay method alone does not decide it.
Private employers generally cannot. Some public agencies may use it under specific rules.
Yes. Under 29 CFR 785.11, work the employer suffers or permits is hours worked. You can discipline someone for breaking an approval rule, but the hours must still be paid.
For tipped employees, overtime is based on the full minimum wage, not the reduced cash wage, so the employer pays the premium on that full rate. Tips themselves are not included in the regular rate.
EZTime records hours and totals them for payroll. Book a demo to see it with your own team.