The Indian overtime formula
Overtime in India is due when work exceeds the normal working day, nine hours under the Factories Act and typically nine under state Shops and Establishments Acts, or 48 hours in a week. The Factories Act (section 59) and the Code on Wages (section 14) both fix the rate at not less than twice the ordinary rate of wages. The ordinary rate includes basic pay, dearness allowance and the cash value of any concessional supplies, but excludes bonus and overtime itself.
To get an hourly rate from a monthly wage, most Indian payrolls divide by 26 paid days and then by 8 hours, because minimum wages are notified per day and monthly figures assume 26 working days. Some monthly-rated establishments divide by 30 days; the calculator lets you choose. A ₹20,800 monthly wage gives ₹800 per day, ₹100 per hour and an overtime rate of ₹200 per hour.
- Hourly rate = Monthly wage ÷ 26 ÷ 8 (defaults; editable)
- OT rate = Hourly rate × 2 for factory and scheduled-employment workers
- Weekly-off or holiday work is typically paid at the same 2× rate or compensated with a substituted off
- Overtime needs approval and, under the Labour Codes, the worker's consent
Common overtime mistakes in Indian payroll
Paying overtime at 1× because the employee is monthly-rated is the most frequent error; the statutory minimum for covered workers is 2× regardless of how salary is expressed. Calculating the hourly rate from gross instead of the ordinary rate over-pays; calculating it from basic alone while DA exists under-pays. And stacking a half-day deduction with overtime on the same date double-counts minutes. Deriving overtime from verified attendance records with the shift end time, rather than from a separate WhatsApp claim, removes most of these disputes.