How overtime pay is calculated (with formulas you can trust)

Overtime sounds simple — “I worked extra hours, so I should get extra pay” — but the confusion usually comes from which hours count as overtime, what rate applies, and how pay periods convert. This calculator is built around the most common and transparent approach: you tell it how many hours are “regular” and how many are “overtime,” then it applies an overtime multiplier (like 1.5× or 2×) to the overtime portion.

Under the hood, the math is straightforward. The calculator first computes an effective base hourly rate by adding an optional shift differential (for night shifts, weekends, etc.) to your hourly wage. Then it computes regular pay, overtime pay, and totals — with an “effective hourly rate” so you can see the value of overtime at a glance. If you’re deciding whether an extra shift is worth it, the effective hourly rate is the most useful single number because it converts your entire paycheck scenario into “dollars per hour” after overtime is applied.

Many roles pay a fixed hourly wage, but some add a differential for specific schedules (overnight, weekends, hazard pay). If you have a differential, it usually applies per hour. So we create:

• Base rate = Hourly Rate + Shift Differential

If you don’t have a differential, leave it at 0 and the base rate is just your hourly rate.

Regular pay is simply your base rate multiplied by regular hours:

• Regular Pay = Base Rate × Regular Hours

“Regular hours” are the hours that are paid at your normal rate. In many weekly payroll systems, that’s the first 40 hours. But some workplaces define regular hours differently (e.g., part-time schedules, alternative work weeks, union rules). This is why the calculator asks you to enter regular hours explicitly — so you can match what your employer considers “regular” for your situation.

Overtime pay applies a multiplier to your base rate for overtime hours:

• Overtime Pay = Base Rate × Overtime Multiplier × Overtime Hours

The overtime multiplier is commonly 1.5× (time-and-a-half) or 2× (double time), but it can also be custom. For example, some employers pay 1.25× for specific extra shifts, or 1.75× on holidays. Choose a preset or set your own custom multiplier.

Total pay is the sum of regular pay and overtime pay:

• Total Pay = Regular Pay + Overtime Pay

That’s the clean “gross pay” estimate for the period you’re calculating. (Taxes, benefits, and deductions depend on your payroll and are outside the scope of this calculator.)

The effective hourly rate is a reality-check metric: it tells you how much you earn per hour when you blend regular and overtime pay together. It’s computed as:

• Effective Hourly Rate = Total Pay ÷ (Regular Hours + Overtime Hours)

Why does this matter? Because it instantly answers questions like: “If I work 8 extra overtime hours this week, what does my pay average out to per hour?” It also makes it easier to compare different overtime offers: if one shift is double time but shorter, and another is time-and-a-half but longer, the effective hourly rate reveals which one is richer.

In real life, you might know your overtime hours for one week but your paycheck is biweekly, or you may want to “annualize” your overtime pattern. This calculator supports five pay-period views:

• Weekly: uses the hours exactly as entered.
• Biweekly: assumes the entered hours happen each week and multiplies pay by 2.
• Semi-monthly: estimates pay by converting weekly pay into 24 paychecks per year (weekly × 52 ÷ 24).
• Monthly: estimates pay by converting weekly pay into 12 months (weekly × 52 ÷ 12).
• Annualized: estimates yearly pay as weekly × 52.

These conversions are designed for planning, budgeting, and “what if” comparisons — not for payroll accounting. Some companies use 26 biweekly paychecks, some use monthly, and some use semi-monthly. The differences are usually small, but if you need exact payroll alignment, use your employer’s pay schedule and plug in the appropriate weekly numbers.

Example 1: Time-and-a-half overtime. Hourly rate = $20.00, shift differential = $0.00, regular hours = 40, overtime hours = 8, multiplier = 1.5×.

• Base rate = 20 + 0 = $20.00/hr
• Regular pay = 20 × 40 = $800.00
• Overtime pay = 20 × 1.5 × 8 = 20 × 12 = $240.00
• Total pay = 800 + 240 = $1,040.00
• Effective hourly = 1,040 ÷ 48 ≈ $21.67/hr

Even though overtime is paid at 1.5×, the effective hourly rate only rises from $20 to about $21.67 because most of your hours are still regular. That’s why this metric is so useful.

Example 2: Night shift with differential + overtime. Hourly rate = $22.50, shift diff = $1.50, regular hours = 36, overtime hours = 12, multiplier = 1.5×.

• Base rate = 22.50 + 1.50 = $24.00/hr
• Regular pay = 24 × 36 = $864.00
• Overtime pay = 24 × 1.5 × 12 = 24 × 18 = $432.00
• Total pay = 864 + 432 = $1,296.00
• Effective hourly = 1,296 ÷ 48 = $27.00/hr

Notice how the differential increases both regular and overtime pay because the calculator applies it into the base rate before multiplying. If your employer treats differentials differently, set the differential to 0 and add it manually afterward.

Example 3: Double time holiday overtime. Hourly rate = $30.00, regular hours = 40, overtime hours = 4, multiplier = 2×.

• Regular pay = 30 × 40 = $1,200.00
• Overtime pay = 30 × 2 × 4 = $240.00
• Total pay = $1,440.00
• Effective hourly = 1,440 ÷ 44 ≈ $32.73/hr

To keep results clean and shareable, the calculator focuses on gross pay math. It does not calculate taxes, overtime eligibility, meal break penalties, blended overtime rules, bonuses, tips, or payroll rounding to the nearest minute. Use it as a fast estimate, then compare against your pay stub for exact totals.

Overtime Hours Calculator FAQs

• What counts as “overtime hours”?

  Overtime hours are the hours your employer pays at an overtime rate (a multiplier above 1×). Commonly, in weekly payroll systems, overtime begins after 40 hours in a week. But rules vary by employer, contract, and location. The easiest approach: look at your pay stub or policy and enter the hours already labeled as “overtime.”

• What’s the difference between time-and-a-half and double time?

  Time-and-a-half means your overtime rate is 1.5× your base hourly rate. Double time means 2× your base rate. Example: at $20/hr, time-and-a-half is $30/hr and double time is $40/hr.

• Why does the effective hourly rate matter?

  It converts the entire scenario into one comparable number: total pay divided by total hours. This makes it easy to compare two offers that have different overtime hours or multipliers. It also helps you see the “average” pay impact of overtime over your whole week.

• How do you convert weekly pay to monthly or annual pay?

  The calculator uses standard planning conversions: annual = weekly × 52; monthly = weekly × 52 ÷ 12; semi-monthly = weekly × 52 ÷ 24; biweekly = weekly × 2. These are estimates for budgeting. Exact payroll can vary if your employer uses a specific pay calendar.

• Does shift differential increase overtime pay too?

  In this calculator, yes — the differential is added to the base rate first, and then the overtime multiplier is applied. Many employers treat differentials this way, but not all. If your policy is different, set shift differential to 0 and calculate it separately.

• Can I use this for salaried employees?

  If you can convert salary to an hourly rate and you know which hours are paid at an overtime multiplier, you can use this tool for estimates. Overtime eligibility for salaried roles depends on classification rules, so use it for planning only.

• Why might my pay stub differ from this result?

  Payroll systems may round time punches, apply different rules for daily vs weekly overtime, compute blended rates, include bonuses, apply overtime caps, or handle differentials differently. Taxes and deductions also change net pay. This tool is meant to be a quick, transparent estimator.

• Can I save multiple scenarios?

  Yes. Tap “Save Scenario” after each calculation. Saved scenarios stay on your device (in your browser’s local storage) so you can compare overtime options.