Quick answer: Under federal law (the Fair Labor Standards Act), non-exempt employees must be paid at least 1.5 times their regular rate of pay for every hour worked over 40 in a workweek. The basic formula is:
Overtime pay = Regular rate × 1.5 × Overtime hours
For example, if you earn $20 an hour and work 46 hours in a week, you are owed 40 × $20 = $800 in regular pay plus 6 × $30 = $180 in overtime, for a total of $980. Some states, including California, Alaska, Nevada and Colorado, also require overtime based on hours worked in a single day.
Want the answer without the math? Use our free overtime calculator. It applies federal and state rules and shows every step.
Key takeaways
- Federal overtime is based on hours worked in a workweek: a fixed, recurring period of 168 hours (seven consecutive 24-hour days). You cannot average hours across two weeks.
- Overtime is 1.5 times your regular rate, which is not always your base hourly wage. Non-discretionary bonuses, commissions and shift differentials must be included in it.
- Federal law has no daily overtime and no automatic premium for weekends or holidays. Some states and employment contracts add these.
- Being paid a salary does not by itself make you exempt from overtime. Exempt status depends on your salary level and your job duties.
- When federal and state rules differ, you are entitled to whichever rule gives you more pay.
How to calculate overtime pay, step by step
Step 1: Confirm you are eligible for overtime (non-exempt)
Most hourly workers are non-exempt and must receive overtime. Salaried employees are generally exempt only if they meet all three tests:
- They are paid a fixed salary.
- The salary is at least the federal minimum of $684 per week ($35,568 a year).
- Their main job duties qualify as executive, administrative or professional.
Several states, including California, New York and Washington, set higher salary thresholds.
Step 2: Add up all hours worked in the workweek
Count every hour you actually worked in your employer’s defined workweek. Convert minutes to decimals before multiplying, for example 42 hours 30 minutes = 42.5 hours (our minutes to decimal converter can help). Hours worked generally include:
- Short rest breaks, typically 5 to 20 minutes.
- Required work before or after your shift, such as setting up equipment or attending required meetings.
- Time when you are required to stay on the premises or on call under tight restrictions.
Bona fide meal breaks of 30 minutes or more, when you are completely relieved of duty, usually do not count as hours worked. Paid time off, holidays and sick leave that you did not work also do not count toward the 40-hour threshold under federal law.
Step 3: Find your overtime hours
Overtime hours = Total hours worked in the workweek − 40. If you live in a state with daily overtime, also check each day’s hours (see the state rules section below).
Step 4: Calculate your regular rate of pay
If you are paid only a single hourly wage, your regular rate is that wage. If you also receive other pay, the formula is:
Regular rate = Total straight-time pay for the week (including non-discretionary bonuses, commissions and shift differentials) ÷ Total hours worked
Step 5: Calculate overtime pay and total pay
- Single hourly rate: Overtime pay = Hourly rate × 1.5 × Overtime hours.
- When the regular rate includes bonuses or multiple rates: Straight-time pay for all hours is already counted, so you only add the extra half. Overtime premium = Regular rate × 0.5 × Overtime hours.
Both methods give the same result for a simple hourly worker. Examples of each follow.
Overtime calculation examples
Example 1: Hourly worker, one pay rate
Maria earns $20 per hour and works 46 hours in one workweek.
| Regular pay | 40 hours × $20 | $800.00 |
| Overtime rate | $20 × 1.5 | $30.00/hour |
| Overtime pay | 6 hours × $30 | $180.00 |
| Total gross pay | $980.00 |
Example 2: Hourly pay plus a production bonus
James earns $18 per hour, works 45 hours and earns a $45 production bonus for the week. Because the bonus is non-discretionary (promised for meeting a target), it must be included in the regular rate.
| Straight-time pay | 45 hours × $18 + $45 bonus | $855.00 |
| Regular rate | $855 ÷ 45 hours | $19.00/hour |
| Overtime premium | $19 × 0.5 × 5 hours | $47.50 |
| Total gross pay | $855 + $47.50 | $902.50 |
If the employer ignored the bonus and paid overtime at $27 ($18 × 1.5), James would be underpaid by $2.50 for the week.
Example 3: Two jobs at different rates for the same employer
Priya works 30 hours as a cashier at $16 per hour and 15 hours as a shift lead at $22 per hour, for 45 hours total. Unless she agreed in advance to another permitted method, her regular rate is the weighted average of both rates.
| Straight-time pay | (30 × $16) + (15 × $22) | $810.00 |
| Regular rate | $810 ÷ 45 hours | $18.00/hour |
| Overtime premium | $18 × 0.5 × 5 hours | $45.00 |
| Total gross pay | $810 + $45 | $855.00 |
Example 4: Salaried non-exempt employee
Daniel is paid a $1,000 weekly salary that is intended to cover a 40-hour week. He works 44 hours.
| Regular rate | $1,000 ÷ 40 hours | $25.00/hour |
| Overtime pay | 4 hours × $25 × 1.5 | $150.00 |
| Total gross pay | $1,000 + $150 | $1,150.00 |
Fluctuating workweek method: If an employee and employer clearly agree that a fixed salary covers all hours worked, whether few or many, the regular rate changes each week. For example, a $900 salary with 50 hours worked gives a regular rate of $18 ($900 ÷ 50), and the employee is owed an extra $18 × 0.5 × 10 = $90. This method has strict conditions under federal rules, and several states, including California, do not allow it.
Example 5: Daily overtime in California
Alex works in California at $20 per hour: 10 hours on Monday, 10 on Tuesday, 8 on Wednesday, 8 on Thursday and 6 on Friday, for 42 hours in total.
- Daily overtime: 2 hours on Monday + 2 hours on Tuesday = 4 hours at $30.
- Weekly check: The 4 daily overtime hours are not counted again, so 42 − 4 = 38 regular hours. That is under 40, so there is no extra weekly overtime.
- Total: (38 × $20) + (4 × $30) = $760 + $120 = $880.
Under federal rules alone, Alex would get $860, from 40 regular hours and 2 overtime hours. The California rule gives Alex $20 more, so the California rule applies. Hours are never counted twice as both daily and weekly overtime.
What counts toward the regular rate?
| Included in the regular rate | Generally excluded |
|---|---|
| Hourly wages and salary | Discretionary bonuses (amount and timing entirely up to the employer) |
| Non-discretionary bonuses (production, attendance, safety, retention) | Gifts, such as a holiday bonus not tied to work or performance |
| Commissions | Pay for time not worked (vacation, holidays, sick leave) |
| Shift differentials (night, weekend) | Expense reimbursements |
| On-call pay | Qualifying premium pay, such as overtime already paid at 1.5× or more |
If a bonus covers several weeks, such as a quarterly bonus, the employer must spread it across those weeks and pay any additional overtime owed once the bonus amount is known.
State overtime rules that differ from federal law
Most states follow the federal 40-hour weekly rule. A few add daily overtime or other requirements:
| State | Key rule beyond federal law |
|---|---|
| California | 1.5× for hours over 8 in a workday and for the first 8 hours on the 7th consecutive day of the workweek; 2× for hours over 12 in a workday and over 8 on the 7th consecutive day. |
| Alaska | 1.5× for hours over 8 in a day, for employers with 4 or more employees. |
| Nevada | 1.5× for hours over 8 in a 24-hour period for employees earning less than 1.5 times the state minimum wage (unless an alternative schedule is agreed). |
| Colorado | 1.5× for hours over 12 in a workday or 12 consecutive hours, in addition to over 40 in a workweek. |
State rules include exceptions for certain industries and schedules. Check your state’s labor law page or your state labor department for details.
Special cases
- Hospitals and nursing homes (8/80 system): With a prior agreement, these employers may use a 14-day period. Overtime is then owed for hours over 8 in a day or over 80 in the 14-day period, whichever gives more overtime.
- Comp time: Private employers cannot give time off instead of overtime pay. Only state and local government employers may offer compensatory time off, under specific rules.
- Weekends and holidays: Federal law does not require premium pay for working on a weekend or holiday unless those hours push you over 40 for the week. Your employer’s policy or a union contract may offer more.
- Two employers: Hours at separate, unrelated employers are not combined. Hours at related (joint) employers may have to be.
Overtime and the “no tax on overtime” deduction
For tax years 2025 through 2028, eligible workers can deduct qualified overtime pay from their federal taxable income. Only the premium portion counts: the “half” in time-and-a-half. For example, at $20 an hour, overtime pays $30, and $10 per overtime hour is deductible.
The deduction is capped at $12,500 per year ($25,000 for married couples filing jointly) and phases out at higher incomes. Social Security, Medicare and most state income taxes still apply. Estimate yours with our no tax on overtime calculator.
Common overtime calculation mistakes
- Averaging hours across two weeks. 50 hours one week and 30 the next still means 10 hours of overtime, even on a biweekly paycheck.
- Leaving bonuses out of the regular rate. This is one of the most common reasons overtime is underpaid.
- Counting paid time off toward 40 hours. Under federal law, only hours actually worked count.
- Multiplying minutes as if they were decimals. 45 hours 30 minutes is 45.5 hours, not 45.3.
- Assuming salaried means exempt. Both the salary test and the duties test must be met.
- Counting the same hours twice in states with both daily and weekly overtime.
Frequently asked questions
What is time and a half?
Time and a half means 1.5 times your regular rate of pay. At $20 an hour, time and a half is $30 an hour. It is the minimum overtime rate required by federal law for hours over 40 in a workweek.
How do I calculate overtime for a biweekly paycheck?
Calculate each workweek separately. Find the overtime hours for week one and week two, calculate overtime for each, then add them together. Never add both weeks and subtract 80.
Is overtime calculated daily or weekly?
Under federal law, overtime is weekly: hours over 40 in a workweek. A few states, most notably California, also require daily overtime. You receive whichever calculation results in more pay, without counting any hour twice.
What is double time?
Double time is 2 times the regular rate. Federal law does not require it. California requires it for hours over 12 in a workday and for hours over 8 on the seventh consecutive workday. Some employers and union contracts also offer it.
Can my employer make me work overtime?
Under federal law, employers can generally require employees aged 16 and older to work overtime, as long as it is paid correctly. Some states and industries limit mandatory overtime, for example for certain nurses.
What if my employer did not pay my overtime?
Start by raising it with payroll or HR, with your own record of hours. If that does not resolve it, you can file a complaint with your state labor department or the U.S. Department of Labor’s Wage and Hour Division. Federal claims for back wages generally must be brought within 2 years, or 3 years for willful violations.
Sources
- U.S. Department of Labor, Overtime Pay
- U.S. Department of Labor, Fact Sheet #23: Overtime Pay Requirements of the FLSA
- U.S. Department of Labor, Fact Sheet #56A: Overview of the Regular Rate of Pay
- Electronic Code of Federal Regulations, 29 CFR Part 778: Overtime Compensation
- California Department of Industrial Relations, Overtime FAQ
- Internal Revenue Service, What to know about the No Tax on Overtime deduction
This guide provides general information about U.S. overtime rules and is not legal or tax advice. Rules vary by state, industry and employment agreement. For your specific situation, contact your state labor department or a qualified professional.
