The overtime pay formula

Under the federal Fair Labor Standards Act (FLSA), covered non-exempt employees must be paid at least one and a half times their regular rate of pay for every hour worked over 40 in a workweek. That is where the phrase "time and a half" comes from.

Another way to think about it: every overtime hour pays your normal wage plus a 50% premium. At $20 an hour, each overtime hour pays $20 plus a $10 premium, or $30. The "extra vs. no overtime" figure above is simply that $10 premium times 8 hours.

Step-by-step example

Say you earn $20 an hour and worked 48 hours this week. Here is the math in order:

1. Split the hours: 40 regular, 8 overtime40 + 8
2. Regular pay: 40 × $20$800
3. Overtime rate: $20 × 1.5$30.00
4. Overtime pay: 8 × $30$240
5. Total gross pay for the week$1,040

If you would rather skip the arithmetic, the Overtime Pay Calculator does these steps for you and also handles double time.

Overtime rates at common hourly wages

This table shows the time-and-a-half rate at several hourly wages, plus what 10 overtime hours add to a weekly paycheck.

Weekly pay at $20 an hour as hours go up

Overtime adds up quickly. Here is total gross pay for one week at $20 an hour:

Working 60 hours instead of 40 is 50% more time, but it raises pay by 75%, from $800 to $1,400. To see what a steady overtime schedule adds up to over a year, you can multiply the weekly total by the number of weeks you expect to work, or use the Hourly to Salary Calculator for the base pay part.

Federal overtime rules you should know

Overtime is counted per workweek

A workweek is a fixed, recurring period of 168 hours, or seven consecutive 24-hour days. It does not have to start on Sunday, but your employer has to keep it consistent. Federal law looks at each workweek separately.

Hours cannot be averaged across weeks

If you work 50 hours one week and 30 hours the next, you are owed 10 overtime hours for the first week. The fact that the two weeks average 40 hours does not change that, even if you are paid every two weeks.

Long days alone do not trigger federal overtime

The FLSA does not require overtime for working more than 8 hours in a day, or for working weekends or holidays. Premium pay for those situations comes from state law, a union contract or your employer's own policy.

Comp time is not a substitute in the private sector

Private employers generally cannot give non-exempt employees time off later instead of paying overtime. Some state and local government employers can offer compensatory time under separate rules.

Your "regular rate" may be higher than your hourly wage

Overtime is based on your regular rate of pay, and that can include more than your base wage. Many non-discretionary bonuses, such as production, attendance or safety bonuses promised in advance, shift differentials and commissions must be folded in. Discretionary gifts, like a surprise holiday bonus, generally are not.

Here is how a bonus changes the math. You earn $18 an hour, work 45 hours and earn a $45 production bonus that week:

1. Straight-time pay: 45 × $18 + $45 bonus$855.00
2. Regular rate: $855 ÷ 45 hours$19.00/hr
3. Overtime premium: 5 hrs × ($19 × 0.5)$47.50
4. Total pay for the week$902.50

If the bonus were left out of the regular rate, the week would come to $900.00. The difference is small here, but on large bonuses or long overtime weeks it adds up.

Two jobs at two rates with the same employer

If you work two different jobs for one employer at different rates, the regular rate is usually a weighted average. For example, 30 hours at $20 plus 15 hours at $16 comes to $840 for 45 hours, a regular rate of about $18.67. The overtime premium is then 5 hours × $9.33, or about $46.67, for a total of $886.67. The FLSA also allows paying overtime at the rate for the job you were doing during the overtime hours, but only if you agreed to that before the work was done.

State overtime rules: the California example

Some states set stricter rules than federal law, and when they do, your employer must follow whichever rule pays you more. California is the best-known example. For most non-exempt workers there, overtime is required:

• At 1.5 times the regular rate after 8 hours in a workday, and for the first 8 hours on the seventh consecutive day of work in a workweek
• At 2 times the regular rate after 12 hours in a workday, and after 8 hours on that seventh consecutive day
• At 1.5 times the regular rate after 40 hours in a workweek

That makes a real difference. Four 10-hour days at $20 an hour total 40 hours, so federal law requires no overtime and the week pays $800. Under California's daily rule, 2 hours each day are overtime: 32 hours × $20 plus 8 hours × $30 comes to $880. Some employers use an approved alternative workweek schedule that changes the daily rule, so check how your schedule is set up.

A single 13-hour day in California at $20 an hour breaks down as 8 hours at $20, 4 hours at $30 and 1 hour at $40, for $320. Alaska, Nevada and Colorado also have daily overtime rules with their own conditions, so look up your state's labor department if you work long days.

Do salaried employees get overtime?

Being paid a salary does not, by itself, mean you are exempt from overtime. Under federal rules, most exempt white-collar employees must meet three tests:

1. Salary level. They must earn at least $684 a week, which is $35,568 a year. A 2024 rule that would have raised this level was struck down in court, so $684 remains the federal figure.
2. Salary basis. They must receive a fixed salary that is not reduced because of the quality or quantity of work.
3. Duties. Their main job duties must be executive, administrative or professional as defined by the Department of Labor.

A salaried worker who fails any of these tests is non-exempt and is owed overtime. To find the hourly rate of a salary meant to cover 40 hours, divide the weekly salary by 40. An $800 weekly salary works out to $20 an hour, so overtime is $30 an hour. The Salary to Hourly Calculator can help with the first step. Several states, including California, New York and Washington, set higher salary levels for exemption than the federal minimum.

How overtime is taxed

Overtime is taxed as ordinary wages. Paychecks with overtime sometimes seem heavily taxed because payroll withholding treats the larger check as if you earned that much every pay period. Any extra withholding is sorted out when you file your tax return.

For tax years 2025 through 2028, eligible workers can also take a federal income tax deduction for qualified overtime compensation. The deduction covers only the premium part of overtime, meaning the "half" in time and a half, not the whole overtime paycheck. It is capped at $12,500 a year, or $25,000 for joint filers, and phases out when modified adjusted gross income is over $150,000, or $300,000 for joint filers. You do not need to itemize to claim it, but you need a valid Social Security number, and married couples must file jointly.

How to check your paycheck

1. Track your own hours. Write down start and end times each day, including time worked before or after your shift.
2. Know your workweek. Ask your employer which day the workweek starts so you can total hours correctly.
3. Split each week at 40 hours. Anything over 40 should show up as overtime on your pay stub, plus any daily overtime your state requires.
4. Look for bonuses. If you earned a non-discretionary bonus, check whether it was included in the overtime rate.
5. Ask questions early. If the numbers do not match, raise it with payroll first. If that does not resolve it, the U.S. Department of Labor's Wage and Hour Division or your state labor department can help.

Frequently asked questions

Sources and how we calculated

Examples in this guide use the federal rule of 1.5 times the regular rate for hours over 40 in a workweek and show gross pay before taxes. Rules come from the U.S. Department of Labor's overtime pay guidance, the California Department of Industrial Relations' overtime FAQ and the IRS page What to know about the No Tax on Overtime deduction.