Guides

How Overtime Works

Understand overtime pay rules, time-and-a-half, and how to estimate overtime earnings.

What overtime means

Overtime is extra pay for hours worked beyond a certain threshold. In many cases, that threshold is 40 hours in a workweek.

A common overtime rule is time-and-a-half, which means each overtime hour is paid at 1.5 times your normal hourly rate.

First, separate your total hours into regular hours and overtime hours.

Regular hours are paid at your normal hourly rate. Overtime hours are paid using the overtime multiplier.

For a standard 40-hour weekly threshold, 46 total hours means 40 regular hours and 6 overtime hours.

If you make $20 per hour and work 45 hours in a week, then 40 hours are regular and 5 hours are overtime.

Your regular pay would be 40 x $20 = $800. Your overtime pay would be 5 x $20 x 1.5 = $150. Your total pay would be $950.

Understanding overtime helps you estimate your paycheck, double-check your hours, and catch mistakes before payday.

It is especially useful if your schedule changes from week to week or if you regularly work extra shifts.

Some jobs, states, or agreements use different overtime rules, so use your actual threshold and multiplier when you calculate.

Overtime calculations usually estimate gross pay, which is pay before taxes, insurance, retirement contributions, or other deductions.

If you want a rough take-home estimate, use the paycheck calculator after you estimate your regular and overtime pay.