The Quick Answer
To calculate overtime pay, multiply your hourly rate by the overtime multiplier (usually 1.5×), then multiply by overtime hours worked:
Overtime Pay = Hourly Rate × 1.5 × Overtime Hours
At $25/hr with 10 overtime hours: $25 × 1.5 × 10 = $375 in overtime pay.
Your total weekly pay is your regular pay plus overtime pay.
The Overtime Pay Formula
Here is the complete calculation, step by step:
- Regular Pay = Hourly Rate × Regular Hours
- Overtime Rate = Hourly Rate × OT Multiplier (1.5× or 2×)
- Overtime Pay = Overtime Rate × Overtime Hours
- Total Gross Pay = Regular Pay + Overtime Pay
- Effective Hourly Rate = Total Gross Pay ÷ Total Hours Worked
The effective hourly rate tells you what you actually earned per hour across the entire week, blending regular and overtime hours.
Worked Examples
Example 1: Standard Time and a Half
A warehouse worker earns $22/hr and works 48 hours in one week.
- Regular hours: 40
- Overtime hours: 48 − 40 = 8
- Regular pay: $22 × 40 = $880
- OT rate: $22 × 1.5 = $33/hr
- Overtime pay: $33 × 8 = $264
- Total gross pay: $880 + $264 = $1,144
- Effective rate: $1,144 ÷ 48 = $23.83/hr
Example 2: Double Time
A California worker earns $30/hr and works a 14-hour shift.
Under California law, hours 1–8 are regular, hours 9–12 are time-and-a-half, and hours beyond 12 are double time.
- Regular pay (8 hrs): $30 × 8 = $240
- Time-and-a-half pay (4 hrs): $30 × 1.5 × 4 = $180
- Double-time pay (2 hrs): $30 × 2 × 2 = $120
- Total: $240 + $180 + $120 = $540 for 14 hours
- Effective rate: $540 ÷ 14 = $38.57/hr
Example 3: Low Overtime, Big Annual Impact
A nurse earns $35/hr and consistently works 5 overtime hours per week.
- Weekly OT pay: $35 × 1.5 × 5 = $262.50
- Annual OT income (52 weeks): $262.50 × 52 = $13,650
Even modest overtime hours compound into meaningful annual income.
What Counts as Overtime?
Federal Rules (FLSA)
The Fair Labor Standards Act requires overtime pay for non-exempt employees who work more than 40 hours in a workweek. Key details:
- A "workweek" is any fixed, recurring 168-hour period (7 consecutive 24-hour periods). It does not have to start on Monday.
- Overtime cannot be averaged across multiple weeks. Working 30 hours one week and 50 the next still means 10 hours of OT in the second week.
- The FLSA does not require overtime for weekend or holiday work specifically — only for hours exceeding 40 per week.
State Rules That Go Further
Several states have daily overtime thresholds or other additional requirements:
- California: OT after 8 hours/day. Double time after 12 hours/day. OT also applies after 40 hours/week, and double time for hours beyond 8 on the 7th consecutive workday.
- Alaska: OT after 8 hours/day for employers with 4+ employees.
- Colorado: OT after 12 hours/day or 40 hours/week.
- Nevada: OT after 8 hours/day if the employee earns less than 1.5× the minimum wage.
When federal and state law conflict, the standard that gives the employee more pay applies.
Who Gets Overtime? Exempt vs. Non-Exempt
The FLSA classifies workers into two categories:
Non-exempt (entitled to overtime):
- Most hourly workers
- Salaried workers earning below $844/week ($43,888/year as of 2024)
- Workers whose duties don't meet exemption criteria
Exempt (no overtime required):
- Salaried employees earning at or above $844/week
- Must perform executive, administrative, or professional duties
- Certain computer professionals earning at least $27.63/hr
- Outside sales employees (no salary threshold)
- Highly compensated employees earning over $132,964/year
Being paid a salary does not automatically make someone exempt. Both the salary test and the duties test must be met.
The Overtime Tax Myth
A persistent misconception: "Overtime isn't worth it because it gets taxed more."
This is incorrect. Overtime is taxed at your regular marginal income tax rate. It does not have a special, higher tax rate.
Why it seems higher on your paycheck: payroll withholding systems estimate your annual income based on each pay period. A bigger paycheck makes the system assume you earn more all year, so it withholds more. But when you file your tax return, you pay based on your actual annual income. Any excess withholding comes back as a refund.
Bottom line: You always take home more money with overtime than without it.
How to Calculate Overtime for Salaried Workers
If a salaried employee is non-exempt, their employer must pay overtime. Here's how to calculate the rate:
- Find the hourly rate: Divide weekly salary by the number of hours the salary covers (typically 40)
- Calculate OT rate: Hourly rate × 1.5
- Calculate OT pay: OT rate × hours beyond 40
Example: A non-exempt employee earns $900/week salary.
- Hourly rate: $900 ÷ 40 = $22.50/hr
- OT rate: $22.50 × 1.5 = $33.75/hr
- If they work 45 hours: $33.75 × 5 = $168.75 overtime pay
- Total: $900 + $168.75 = $1,068.75
Blended Rate for Multiple Pay Rates
Some employees work at different rates during the same week (for example, $18/hr for regular duties and $22/hr for specialized tasks). Overtime uses a weighted average:
- Calculate total straight-time earnings: ($18 × 25) + ($22 × 20) = $450 + $440 = $890
- Find the regular rate: $890 ÷ 45 total hours = $19.78/hr
- Calculate OT premium: $19.78 × 0.5 × 5 OT hours = $49.44
- Total pay: $890 + $49.44 = $939.44
Note: The overtime premium is 0.5× (not 1.5×) because the straight-time portion of the overtime hours is already included in step 1.
Common Paycheck Mistakes to Watch For
Comp time instead of overtime pay. Private-sector employers generally cannot offer compensatory time off instead of paying overtime. Comp time is only allowed for government employees under specific conditions.
Averaging hours across weeks. An employer cannot combine two weeks and claim you averaged 40 hours. Each workweek stands alone. Exception: hospitals and nursing homes can use a 14-day period under Section 7(j) of the FLSA.
Excluding bonuses from the regular rate. Non-discretionary bonuses (production bonuses, attendance bonuses) must be included when calculating the regular rate for overtime purposes. This often increases the OT rate slightly.
Rounding errors. Employers may round time to the nearest 5, 6, or 15 minutes, but rounding must be neutral over time — it cannot systematically favor the employer.
What to Do If You're Not Getting Paid Overtime
If you believe you're entitled to overtime and not receiving it:
- Document your hours. Keep your own records of hours worked, separate from your employer's system.
- Review your classification. Check whether you're classified as exempt or non-exempt, and whether that classification is correct.
- Talk to HR. Start with an internal inquiry — sometimes it's an honest payroll error.
- File a complaint. Contact the U.S. Department of Labor's Wage and Hour Division (WHD). Complaints can be filed online or by phone. There is no cost, and employers are prohibited from retaliating.
- Know the statute of limitations. FLSA claims must be filed within 2 years (3 years for willful violations).
Frequently Asked Questions
How do I calculate time and a half?
Multiply your regular hourly rate by 1.5. If you earn $20/hr, time and a half is $30/hr. Then multiply by the number of overtime hours to get your overtime pay.
Is overtime taxed more than regular pay?
No. Overtime wages are taxed at the same income tax rates as regular wages. Higher withholding on overtime paychecks is a payroll estimation issue, not an actual tax increase. Any over-withholding is refunded when you file your return.
What is the federal overtime threshold?
40 hours per workweek. Non-exempt employees must receive at least 1.5× their regular rate for every hour beyond 40, per the FLSA.
Does overtime apply to part-time workers?
Yes. The 40-hour threshold applies regardless of employment classification. A part-time employee who works 45 hours in a week is entitled to 5 hours of overtime.
How do I calculate overtime for salaried employees?
Divide the weekly salary by the number of hours it covers (usually 40) to get an hourly rate. Multiply that rate by 1.5 for the overtime rate. Non-exempt salaried employees are entitled to overtime just like hourly workers.
Can my employer make overtime mandatory?
In most states, yes. Employers can require overtime as long as they pay the correct overtime rate. Exceptions exist in some industries and through union agreements. Refusing mandatory overtime may be grounds for discipline, depending on state law.
How much extra do you earn with 10 hours of overtime per week?
At $25/hr: $25 × 1.5 × 10 = $375/week extra. Over a full year, that's $19,500 in additional gross income before taxes.
Does overtime apply on weekends and holidays?
Not automatically under federal law. The FLSA bases overtime on total weekly hours, not which days are worked. Weekend and holiday premiums are typically set by employer policy or union contracts.
What's the difference between time and a half and double time?
Time and a half = 1.5× your rate. Double time = 2× your rate. Federal law only requires time and a half. Double time is mandated in certain states (notably California after 12 hours/day) and is common in union contracts.
How do I check if I'm classified correctly as exempt or non-exempt?
Review the FLSA salary threshold ($844/week as of 2024) and the duties test for your exemption category. The Department of Labor provides a self-assessment tool. If your classification seems wrong, consult HR or your state labor agency.