Overtime pay in India is now twice your rate of wages for every hour you work beyond the normal limits. Since 21 November 2025 the rules come from the OSH Code, 2020 and the Code on Wages, 2019, and since 8 May 2026 the OSH (Central) Rules, 2026 set out how the hours and the daily rate are counted. This guide shows how to calculate overtime pay step by step, for monthly salary and daily wage workers, with worked examples.
Quick answer: with monthly wages of ₹25,000, your hourly wage is ₹120.19, your overtime rate is ₹240.38 an hour, and 10 hours of overtime pays ₹2,404. "Wages" means Basic + DA (plus retaining allowance), not your full gross salary. To work out your own figure, use our overtime calculator.
What Counts as Overtime in India?
Under Section 25 of the OSH Code, no worker can be made to work more than 8 hours in a day, and under the OSH (Central) Rules the limit is 48 hours in a week, with no more than 6 working days a week. Work beyond these limits is overtime.
Section 27 of the OSH Code says overtime is counted on a daily or weekly basis, whichever is more favourable to the worker, and that an employer can ask for overtime only with the worker's consent. Rule 69(1) of the Central Rules says overtime is paid at the end of each wage period.
Overtime Calculation Formula, Step by Step
- Find your wages. Take Basic + DA + retaining allowance. If your other allowances are more than 50% of your total pay, add the excess back (the 50% rule under the Code on Wages).
- Find the daily wage. Divide monthly wages by 26. Rule 69(3) of the OSH (Central) Rules, 2026 treats the daily rate of a monthly-paid worker as one twenty-sixth of the monthly wage.
- Find the hourly wage. Divide the daily wage by 8 normal working hours.
- Double it. The overtime rate is twice the hourly wage (Section 27 of the OSH Code; Section 14 of the Code on Wages says "not less than twice").
- Multiply by overtime hours. Count part hours as the rules say (see below), then multiply.
For daily-rated workers, skip step 2: divide the daily wage by 8 to get the hourly wage.
Overtime Pay Table by Monthly Wages
Figures use 26 working days and 8 hours a day, rounded to the nearest rupee. They match our overtime calculator.
| Monthly wages | Hourly wage | Overtime rate per hour | 4 hours | 10 hours | 20 hours |
|---|---|---|---|---|---|
| ₹15,000 | ₹72.12 | ₹144.23 | ₹577 | ₹1,442 | ₹2,885 |
| ₹25,000 | ₹120.19 | ₹240.38 | ₹962 | ₹2,404 | ₹4,808 |
| ₹40,000 | ₹192.31 | ₹384.62 | ₹1,538 | ₹3,846 | ₹7,692 |
| ₹60,000 | ₹288.46 | ₹576.92 | ₹2,308 | ₹5,769 | ₹11,538 |
Overtime Calculation Examples
Example 1: Monthly salary employee, wages known
Ravi's Basic + DA is ₹25,000 a month and he worked 10 overtime hours this month.
- Daily wage: ₹25,000 ÷ 26 = ₹961.54
- Hourly wage: ₹961.54 ÷ 8 = ₹120.19
- Overtime rate: ₹120.19 × 2 = ₹240.38 an hour
- Overtime pay: ₹240.38 × 10 = ₹2,404
Example 2: Gross salary ₹30,000, Basic + DA ₹15,000
Allowances are ₹15,000, which is exactly 50% of ₹30,000, not more. So nothing is added back and wages stay at ₹15,000. Overtime for 10 hours = (15,000 ÷ 26 ÷ 8) × 2 × 10 = ₹1,442. Calculating on the full gross of ₹30,000 would wrongly give ₹2,885.
Example 3: Allowances above 50% of pay
Meena's gross salary is ₹40,000 and her Basic + DA is ₹12,000. Her allowances of ₹28,000 are ₹8,000 more than half her pay (₹20,000), so ₹8,000 is added back and her wages become ₹20,000. Overtime for 15 hours = (20,000 ÷ 26 ÷ 8) × 2 × 15 = ₹2,885.
Example 4: Daily wage worker
A worker paid ₹700 a day works 10 hours on one day, 2 hours beyond the 8-hour limit. Hourly wage = ₹700 ÷ 8 = ₹87.50. Overtime = ₹87.50 × 2 × 2 = ₹350, on top of the ₹700 day's wage.
Example 5: Daily vs weekly count
A worker on ₹18,000 monthly wages works 10, 10, 6, 8, 8 and 4 hours in a week, 46 hours in all. On a weekly count there is no overtime, because 46 is below 48. On a daily count, Monday and Tuesday each have 2 hours beyond 8, so 4 hours. Section 27 requires the count more favourable to the worker, so 4 hours are paid: (18,000 ÷ 26 ÷ 8) × 2 × 4 = ₹692.
Example 6: Part hours
Rule 69(2) of the OSH (Central) Rules counts 15 to 30 minutes as half an hour and more than 30 minutes as a full hour. So 2 hours 20 minutes counts as 2.5 hours, 1 hour 40 minutes counts as 2 hours, and 10 minutes is not counted.
Is Overtime 1.5 Times or 2 Times in India?
For workers covered by Indian labour law, it is 2 times. "Time and a half" (1.5×) is a rule from other countries, such as the USA, and is often copied into Indian articles by mistake. An employer can pay more than double, but paying a worker less than twice the rate of wages does not meet Section 27 of the OSH Code.
26 Days or 30 Days?
For establishments under the central government, rule 69(3) of the OSH (Central) Rules, 2026 takes one twenty-sixth of the monthly wage as the daily rate, so 26 days is the figure to use. States notify their own rules for establishments under them, and some company policies still use 30 days, which gives a lower rate.
| Wages ₹25,000, 10 hours | Hourly wage | Overtime pay |
|---|---|---|
| 26 days × 8 hours = 208 | ₹120.19 | ₹2,404 |
| 30 days × 8 hours = 240 | ₹104.17 | ₹2,083 |
Dividing by 160 hours (20 days × 8), used in some older guides, has no basis in the rules.
Who Is Entitled to Overtime Pay?
- Covered: anyone who is a "worker" under the OSH Code, in factories, shops, offices, construction sites and other establishments with 10 or more workers.
- Not covered: people employed mainly in a managerial or administrative capacity, and those in a supervisory capacity drawing wages above ₹18,000 a month. Their overtime, if any, depends on their appointment letter or company policy.
- Women on night shifts: under Section 43 of the OSH Code, women can work before 6 am and after 7 pm only with their consent and subject to safety conditions.
- Shops and offices: your state's Shops and Establishments Act can also set hours and overtime limits, so check it along with the OSH Code.
Overtime Hours Limit Per Quarter
The OSH Code leaves the total overtime hours to the appropriate government, so the quarterly limit depends on your state and sector. For dock work, mines and building and other construction work under the central government, the proviso to rule 69(4) of the OSH (Central) Rules caps overtime at 144 hours in a quarter. Older limits from the Factories Act, 1948 no longer apply, because the OSH Code replaced that Act.
Overtime, PF, ESI and Tax
- PF and ESI: overtime allowance is excluded from "wages" under the Code on Wages. But it still counts in the month's 50% test, so a large overtime payment can raise your wages for PF and ESI for that month. The overtime amount itself is not recalculated. See the worked table on our overtime calculator page.
- Income tax: the Income Tax Department lists overtime allowance as fully taxable. It is added to your salary income in both the old and new regimes, and TDS applies. Check the effect with our income tax calculator.
- Bonus and gratuity: both are worked out on wages, and overtime is not part of wages. See our bonus calculator and gratuity calculator.
Overtime Records and Unpaid Overtime
Employers under the central sphere must keep a register of wages, overtime and deductions in Form XV and an attendance register-cum-muster roll in Form XIV (rule 72), keep the records for five years, and give wage slips by pay day. If your overtime is not paid, keep your own record of dates and hours, raise it with HR first, and then approach the Inspector-cum-Facilitator or file a claim under the Code on Wages. For dues on leaving a job, read our full and final settlement guide.
For the full rules in plain words, read OSH Code 2020 explained and the Code on Wages guide, or see the Ministry of Labour and Employment.
Common Overtime Calculation Mistakes
- Paying 1.5× instead of 2×.
- Calculating on gross salary or CTC instead of wages.
- Dividing by 160 or 240 hours when the rules use 26 days of 8 hours.
- Counting only weekly hours when the daily count gives the worker more.
- Dropping part hours of 15 minutes or more.
Frequently Asked Questions
How is overtime calculated in India?
Divide monthly wages by 26 and then by 8 to get the hourly wage, multiply by 2, then multiply by your overtime hours. For ₹25,000 wages and 10 hours: (25,000 ÷ 26 ÷ 8) × 2 × 10 = ₹2,404.
How much is 4 hours of overtime?
It is 4 × twice your hourly wage. With monthly wages of ₹25,000, the overtime rate is ₹240.38 an hour, so 4 hours pays ₹962. With ₹15,000 wages it is ₹577.
Is overtime paid at 1.5 times or 2 times in India?
2 times. Section 27 of the OSH Code, 2020 requires overtime at twice the rate of wages. 1.5 times is a rule from other countries, not Indian law.
Is overtime calculated on basic or gross salary?
On wages: Basic + DA + retaining allowance, plus any allowances above 50% of total pay. It is not calculated on full gross salary or CTC.
How do I calculate overtime for a monthly salary employee?
Take monthly wages, divide by 26 days for the daily rate, as rule 69(3) of the OSH (Central) Rules, 2026 provides, then by 8 hours. Double that hourly figure and multiply by the overtime hours.
How many overtime hours are allowed in a quarter?
It depends on the rules of the appropriate government. The OSH (Central) Rules, 2026 allow up to 144 hours a quarter for dock work, mines and construction work under the central government.
Can my employer make overtime compulsory?
No. Under Section 27 of the OSH Code, an employer can require overtime only with the worker's consent.
Do managers and supervisors get overtime pay?
Not under the OSH Code. Its definition of worker excludes managerial or administrative staff and supervisors drawing wages above ₹18,000 a month. Their overtime depends on their contract or company policy.
Is overtime pay taxable in India?
Yes. The Income Tax Department lists overtime allowance as fully taxable. It is added to salary income in both tax regimes and TDS applies.
How are part hours of overtime counted?
Under rule 69(2) of the OSH (Central) Rules, 2026, 15 to 30 minutes counts as half an hour and more than 30 minutes counts as a full hour. State rules may differ.