How overtime pay is calculated
- Split the week's hours: the first 40 are regular, the rest are overtime.
- Multiply your hourly rate by 1.5 to get the overtime rate.
- Pay regular hours at your rate and overtime hours at the overtime rate, then add them.
Overtime pay = overtime hours × hourly rate × 1.5
For the example above, 46.5 hours at $20 an hour:
| Hours | Rate | Pay | |
|---|---|---|---|
| Regular | 40.00 | $20.00 | $800.00 |
| Overtime | 6.50 | $30.00 | $195.00 |
| Total | 46.50 | $995.00 |
If you have your hours as a time card, total the week with the time card calculator first. It splits out overtime too.
Who gets overtime
Under the federal Fair Labor Standards Act, non-exempt employees must get at least 1.5 times their regular rate for hours over 40 in a workweek. Most hourly workers are non-exempt. Some salaried executive, administrative and professional employees are exempt, depending on their pay and duties. See the Department of Labor's overtime rules.
- The workweek is fixed. It is any set 7-day period your employer chooses, and two weeks cannot be averaged.
- The regular rate can be more than your base rate. Non-discretionary bonuses and shift differentials are added in before overtime is figured.
- Private employers cannot swap overtime pay for comp time. Comp time instead of overtime pay is generally only allowed in the public sector.
Daily overtime and double time
Federal law only counts overtime by the week, but some states also count it by the day. In California, for example, hours over 8 in a day are paid at 1.5×, and hours over 12 in a day are paid at double time. See California's overtime FAQ.
To check a double-time payment, set the overtime rate above to Double time (2×).
Overtime and taxes
The pay shown is before taxes. Overtime is taxed like the rest of your wages on each paycheck, though bigger checks can push withholding up for that pay period.
For tax years 2025 through 2028, a new federal income tax deduction covers the extra "half" of FLSA-required overtime, up to $12,500 a year ($25,000 for joint filers), phasing out at higher incomes. It is claimed on your tax return, not taken off your paycheck, and Social Security and Medicare taxes still apply. In the example above, the deductible part is 6.5 hours × $10 = $65.