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Overtime Pay Premium Calculator

How much extra does overtime cost above straight-time pay?

How it is calculated

The tool prices a pay period from the hours you enter. You give the base hourly rate (dollars), regular hours, overtime hours and the overtime multiplier (1.5 for time-and-a-half, 2 for double time). regular pay = rate × regular hours, overtime pay = rate × multiplier × overtime hours and total pay = regular pay + overtime pay. The premium is only the extra above straight time: premium = rate × (multiplier − 1) × overtime hours. The blended rate is total pay / (regular + overtime hours). The tool does not decide which hours count as overtime, so you split the hours yourself according to the rule that applies where you work. The multiplier cannot be below 1, and there is no result if no hours at all are entered.

Worked example

Base rate 20 per hour, 40 regular hours, 8 overtime hours at 1.5. Step 1: regular pay = 20 × 40 = $800.00. Step 2: overtime pay = 20 × 1.5 × 8 = $240.00. Step 3: total pay = 800 + 240 = $1,040.00. Step 4: the premium above straight time = 20 × 0.5 × 8 = $80.00. Step 5: blended rate = 1,040 / 48 = $21.67 per hour.

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Common mistakes

  • Counting all hours, including the overtime ones, in the regular hours field. The 8 overtime hours would then be paid twice; enter 40 and 8, not 48 and 8.
  • Confusing the multiplier with the premium. Time-and-a-half is entered as 1.5, not 0.5, and a value below 1 gives no result.
  • Expecting the premium to equal the whole overtime pay. The premium is only the extra above straight time; the overtime pay line shows the full amount.
  • Using the wrong base rate. If your overtime is calculated on a rate that includes shift allowances or bonuses, enter that rate instead of the plain hourly wage.
  • Assuming every country uses the same threshold and multiplier. The tool applies whatever hours and multiplier you give it; check your own labour rules for the correct split.

About this calculator

Under standard overtime rules (such as the U.S. Fair Labor Standards Act), hours worked beyond the regular threshold are paid at 1.5 times the base hourly rate — the "time-and-a-half" rate — and some contracts or jurisdictions apply double-time (2x) for hours beyond a second threshold or for holiday work. The overtime premium is the extra amount paid above what those hours would have cost at the straight-time rate: overtime hours × base rate × 0.5 for time-and-a-half, or × 1.0 for double-time.

Payroll teams and employers use this figure to budget labor costs and to see how much a scheduling decision — an extra shift, a crunch week — actually adds to payroll beyond the base wage. The blended hourly rate, which divides total pay for the period by total hours worked, gives a single "effective" rate that's useful for comparing labor cost across pay periods with different amounts of overtime.

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