How to Calculate Overtime Pay, Step by Step

Estimate for personal reference only. Not tax, legal, or employment advice. Overtime defaults follow a federal FLSA-style workweek, usually 1.5× after 40 hours. State and city rules may differ.

The short version

How to calculate overtime, under the federal pattern these pages use, is a weekly split. Add the hours worked in the workweek. Regular hours are the smaller of that total and 40. Overtime hours are the total minus 40, and never less than zero. Regular pay is regular hours times the hourly rate. Overtime pay is overtime hours times the rate times 1.5. Gross pay adds those two. You can do it on paper or on the overtime calculator. The steps below are the same arithmetic the form runs.

Step by step

Use the workweek your employer actually observes. It is seven consecutive days. It does not have to start on Sunday or on the first of the month.
Add hours worked. If the timesheet says 8:30, convert it before you add. 8:30 is 8.50 decimal hours on the hours to decimal calculator, because 30 / 60 = 0.50. Do not type 8.30.
If you have seven daily rows, add them on the weekly overtime calculator. Blank days are zero. The week total is what gets split, not each day.
Regular hours = the hours up to 40. A 38-hour week has 38 regular hours and no overtime. A 45-hour week has 40 regular hours and 5 overtime hours.
Overtime rate = hourly rate × 1.5. At $20, the overtime rate is $30. That full $30 is time and a half. The extra $10 is the half inside it, not a second payment. The time and a half calculator is the page that isolates that idea.
Regular pay = 40 × $20 = $800. Overtime pay = 5 × $30 = $150. Gross = $950. Straight time for all 45 hours would have been $900, so the overtime premium in the gross is $50.

Where the steps get longer

The rate is not always the number printed on the offer. The Department of Labor’s overtime materials explain a regular rate that can include certain bonuses and differentials. Two different hourly rates in one week need a weighted rate before the 1.5× is applied. This guide and the calculators use the single rate you type. They do not build that weighted rate, and they do not subtract taxes.

Daily overtime and double time are outside the federal weekly step. If you are pricing hours you already know are at 2×, use the double time calculator. If one week contains a regular band, a 1.5× band, and a 2× band, the overtime calculator can take a second threshold, and you have to supply the threshold yourself. The FLSA overtime page says, in plain language, that the FLSA summary is not a 50-state code and not legal advice.

Worked example, written out

Rate $20. Hours 45. Threshold 40. Multiplier 1.5. Regular hours = min(45, 40) = 40. Overtime hours = max(45 − 40, 0) = 5. Regular pay = 40 × 20 = 800. Overtime pay = 5 × 20 × 1.5 = 150. Gross pay = 800 + 150 = 950. If the 45 hours were five clock days of 9:00, the weekly card produces the same total. If one of those days was 8 hours 30 minutes, put 8.50 in that row, not 8.30, or the week total moves by 0.20 hours before the split even starts.

The same steps are restated as formulas on assumptions and formulas. The Department of Labor pages below are the public sources for the federal rule. They are the place to check a real paycheck question. This article is an explanation of the arithmetic.

Frequently asked questions

What is the fastest way to calculate overtime?

Convert the week to decimal hours, subtract 40, and multiply the leftover hours by 1.5 times the hourly rate. Add that to 40 times the rate. For 45 hours at $20, that is $800 plus $150, or $950.

Do I include paid time off in the 40 hours?

Under the FLSA, overtime is based on hours worked. Paid leave often does not count as hours worked. Your employer’s policy can be more generous. This guide does not decide that for a particular job.

Where are the official rules?

Start with the U.S. Department of Labor overtime page and Fact Sheet #23. Those are the sources for the federal summary on this site.