When work becomes overtime
Under the Factories Act (s.59), a worker who works more than 9 hours in a day or 48 hours in a week is entitled to overtime wages at twice the ordinary rate. The Code on Wages and the OSH Code carry the same double rate forward for all establishments they cover, with the daily limit to be notified by the appropriate government within the 48-hour week. Shops and Establishments Acts set state-specific triggers, usually also 9 a day and 48 a week.
Overtime is also subject to caps on total quarterly hours and, under the OSH Code, requires the worker's consent. Overtime cannot be used to make a 12-hour shift permanent; a 12-hour post worked six days a week is 72 hours and breaches every limit regardless of payment.
How the overtime rate is calculated
The ordinary rate is the basic wage plus dearness allowance and other cash allowances that form part of wages, excluding bonus and overtime itself. For a monthly wage, common practice is: hourly rate = (monthly wage ÷ 26) ÷ 8; overtime rate = hourly rate × 2. Some employers divide by 30 and 8 for monthly-salaried staff; the divisor should be written into the wage policy and applied consistently.
Under the Code on Wages, the 50% wages rule also affects which components enter the ordinary rate. Use the overtime pay calculator to test your formula, and read the overtime calculation formula guide for the statutory detail.
- Hourly rate = (monthly wages ÷ 26) ÷ 8 for daily-rated and minimum-wage workers.
- OT rate = hourly rate × 2 (statutory minimum).
- Count OT in minutes worked beyond shift end, after any grace or rounding rule stated in policy.
- Weekly OT: hours beyond 48 in the week even if no single day exceeded 9.
Approval, recording and payroll
Overtime should be approved before or immediately after it is worked, recorded against the shift and the day, and shown in the overtime register that the Factories Act (s.62) and state rules require. Unapproved punches beyond shift end are the main source of payroll disputes: the worker says they stayed on instruction, the supervisor says they were chatting at the gate.
A clean process derives overtime from attendance (out-punch minus rostered shift end, minus policy grace), routes it to the supervisor for approval, and only approved minutes reach payroll. Security agencies additionally need overtime by site so that it can be billed to the client where the contract allows.
Monthly wage ₹15,600 ÷ 26 = ₹600 per day; ÷ 8 = ₹75 per hour; overtime rate ₹150 per hour. In a week the helper works 9 hours on five days and 12 hours on Saturday. Saturday has 3 hours beyond the daily limit, so OT = 3 × ₹150 = ₹450. Weekly hours are 57, and the 9 hours beyond 48 include the same 3 hours plus 6 more that arose from 9-hour days; whether those 6 hours are OT depends on whether the 9-hour day is within the notified limit, which it is under the Factories Act.
Attend Mitra calculates overtime per shift template from actual punches, applies your grace and rounding rules, and sends the minutes to a supervisor approval queue. Approved overtime flows into payroll-ready reports and, for security agencies, into site-wise man-hour exports for client billing. Rates and divisors are set in payroll settings, not hard-coded.