Overtime Pay Calculator

Calculate overtime pay at 1.5x and 2x rates for hourly employees.

Formula

Overtime Pay = Regular Hourly Rate × 1.5 × Overtime Hours
Total Pay = (Regular Rate × 40) + (Regular Rate × 1.5 × OT Hours)

How to Calculate

Under the Fair Labor Standards Act (FLSA), non-exempt employees must be paid at least 1.5 times their regular rate for hours worked beyond 40 in a workweek. Some states have additional requirements—California, for example, requires overtime after 8 hours in a single day and double-time after 12 hours.

The "regular rate" is not always the same as the hourly wage. It includes base pay plus non-discretionary bonuses, shift differentials, and certain other compensation, divided by total hours worked. This calculation catches many employers off guard when they realize bonuses increase the overtime rate.

For salaried non-exempt employees, divide the weekly salary by 40 to determine the regular rate, then apply the 1.5x multiplier for hours over 40. Note that the FLSA overtime threshold was updated—employees earning below a certain salary threshold ($43,888 annually as of 2024) must be classified as non-exempt and eligible for overtime, regardless of their duties.

Worked Example

An employee earns $25/hour and worked 52 hours this week.

Regular pay (40 hours): 40 × $25 = $1,000
Overtime hours: 52 − 40 = 12 hours
Overtime rate: $25 × 1.5 = $37.50/hour
Overtime pay: 12 × $37.50 = $450

Total gross pay: $1,000 + $450 = $1,450

In California, if the employee worked four 13-hour days:
First 8 hours each day: regular rate ($25)
Hours 8–12 each day: 1.5× rate ($37.50)
Hours 12–13 each day: 2× rate ($50.00)
Daily pay: (8 × $25) + (4 × $37.50) + (1 × $50) = $200 + $150 + $50 = $400

Why It Matters

Overtime compliance is a critical legal obligation. Misclassifying employees as exempt, miscalculating the regular rate, or failing to pay proper overtime are among the most common wage-and-hour violations, leading to costly lawsuits and Department of Labor penalties. Understanding overtime rules protects both employers and employees.

Practical Tips

  • Always include non-discretionary bonuses and shift differentials when calculating the regular rate for overtime.
  • Verify employee exempt/non-exempt classification annually—salary and duties tests change periodically.
  • Check your state's overtime laws—many states have stricter requirements than federal law.
  • Use time-tracking software to accurately capture all hours worked, including off-the-clock time.

Frequently Asked Questions

Who is exempt from overtime pay?
Employees are exempt from FLSA overtime if they meet both a salary test (currently $43,888/year or $844/week) and a duties test for executive, administrative, professional, computer, or outside sales roles. Simply paying someone a salary does not make them exempt—the duties test must be met.
Does overtime apply to salaried employees?
It can. Salaried employees who earn below the FLSA salary threshold or who do not meet the duties test for exemption are "salaried non-exempt" and must receive overtime pay. Their regular rate is calculated by dividing their weekly salary by 40 hours.
Can an employer require mandatory overtime?
Generally yes, under federal law. Employers can require employees to work overtime and can discipline or terminate employees who refuse, as long as they pay the proper overtime premium. However, some union contracts and state laws may restrict mandatory overtime, particularly in healthcare.

Skip the Manual Calculations

FiscalInsights automates your financial calculations, tracks your metrics in real time, and gives you actionable insights to grow your business.

Start Free Trial

Learn More About This Topic

Related Calculators