Overtime Pay Calculator

How do I calculate overtime pay?

Overtime pay is calculated by multiplying your hourly rate by an overtime multiplier — then multiplying that result by the number of overtime hours worked. Under the Fair Labor Standards Act, the federal minimum multiplier is 1.5, so a $25/hour employee earns $37.50 for each overtime hour. The full formula for a pay period:

• Regular pay = hourly rate × regular hours worked
• Overtime pay = (hourly rate × 1.5) × overtime hours
• Total gross pay = regular pay + overtime pay

At $25/hour with 80 regular hours and 6 overtime hours in a bi-weekly period: regular pay is $2,000, overtime pay is $225, and total gross is $2,225.

One output worth paying attention to is the overtime premium — the extra dollars earned above what those same hours would have paid at straight time. In this example, the 6 overtime hours would have paid $150 at regular rate but pay $225 at overtime, so the premium is $75. For employers, this is the true incremental cost of an overtime hour versus scheduling an additional shift: not the full $37.50, but the $12.50 premium on top of what you'd have paid anyway.

The calculator also projects annualized earnings based on your pay frequency — useful for total compensation comparisons when one role includes regular overtime and another doesn't.

What is the federal overtime law?

The Fair Labor Standards Act (FLSA) requires that most U.S. employees be paid at least 1.5 times their regular hourly rate for any hours worked beyond 40 in a single workweek. The 40-hour threshold applies per workweek — not per pay period — so a bi-weekly employee who works 45 hours one week and 35 the next owes 5 overtime hours for week one, even though total hours for the period are only 80.

A few things the FLSA does not require: overtime for hours beyond 8 in a single day (that's a California rule, not federal), double time at any threshold (also state-specific), or premium pay on weekends or holidays unless those hours push total weekly hours above 40.

Not every worker is covered. "Exempt" employees — generally salaried workers in executive, administrative, or professional roles earning above $684/week — are excluded from FLSA overtime protections. Hourly workers and non-exempt salaried employees are covered regardless of job title.

This calculator defaults to the 1.5× FLSA multiplier. Both the overtime and double time multipliers are editable inputs, so you can adjust them to match a union contract, state law, or employer policy that differs from the federal baseline.

What's the difference between overtime pay and double time pay?

Both are premium pay rates for extra hours worked, but they apply at different thresholds and are governed by entirely different rules.

Overtime (1.5× rate) is federally mandated under the FLSA for hours beyond 40 in a workweek. Nearly every state follows the same threshold. At $25/hour, the overtime rate is $37.50.

Double time (2× rate) is not required by federal law. It applies in three specific situations:

• California state law: hours beyond 12 in a single workday, and all hours on the seventh consecutive day of work in a workweek
• Collective bargaining agreements: many union contracts require double time for holidays, overnight shifts, or hours exceeding a daily cap
• Employer policy: some companies offer double time voluntarily to fill hard-to-staff shifts

At $25/hour, the double time rate is $50.

In this calculator, double time is a separate input tier. If it doesn't apply to your situation, enter 0 for double time hours and that tier is ignored. If you're in California or covered by a union contract with daily overtime rules, enter the applicable hours in each field separately to get an accurate gross pay figure — mixing overtime and double time hours into a single input would understate your pay.

Do salaried employees get overtime pay?

It depends on whether they're classified as exempt or non-exempt under the FLSA — and job title alone doesn't determine that.

Non-exempt salaried employees are entitled to overtime pay even though they receive a salary. To find their overtime rate, convert the weekly salary to an effective hourly rate (weekly salary ÷ expected hours), then apply the 1.5× multiplier to hours above 40 per week.

Exempt salaried employees are not entitled to overtime, regardless of hours worked. Exemption requires meeting both a salary threshold ($684/week, or $35,568/year, as of 2024) and a duties test — meaning the employee's primary responsibilities are executive, administrative, professional, outside sales, or certain computer-related work. Both conditions must be met; a high salary alone doesn't create an exemption.

Misclassifying non-exempt employees as exempt is one of the most common wage-and-hour violations, often resulting in back pay liability, penalties, and class action exposure. When in doubt, the Department of Labor's FLSA exemption guidance is the authoritative source.

This calculator is designed for hourly workers and non-exempt employees who receive overtime. If you're a salaried non-exempt employee, convert your weekly salary to an hourly equivalent first, then enter that figure as your regular hourly rate.

What percentage of payroll is overtime, typically?

For most industries, overtime runs between 2% and 5% of total payroll in a given period. Manufacturing, healthcare, and transportation tend to run higher — often 6% to 12% — because shift coverage requirements make scheduled overtime a structural part of operations rather than an exception.

A useful rule of thumb for managers: when overtime consistently exceeds 5% of payroll, it's generally cheaper to hire an additional part-time or full-time employee than to continue paying the 1.5× premium. The breakeven point shifts depending on benefits costs — a new hire who qualifies for full benefits adds 20–30% in loaded cost on top of base wages, which narrows the gap.

The overtime premium output in this calculator makes that comparison concrete. It shows only the incremental cost above straight time — not the full overtime wage — which is the right number to use when deciding between scheduling overtime and adding headcount. If an overtime hour costs $37.50 but the premium is only $12.50, you're comparing that $12.50 against the fully loaded cost of an additional worker, not against $37.50.

Annualized overtime pay is the other useful benchmark: if a role regularly generates $5,000–$10,000 in annualized overtime, that figure belongs in the total compensation conversation during hiring, not just the base hourly rate.