Hello Sir/Madam,
I am working in a small start-up pharma Pvt. Ltd. company with 10 employees and 2 office boys. I have a query regarding overtime calculation. Our office hours are from 9:30 am to 6:00 pm with a 40-minute lunch break in between. Sometimes, due to urgent work or submissions, we have to work extra hours, typically half an hour to one hour, and our office boys work an additional 3-4 hours.
I would like to know how to calculate this overtime or extra time worked and how to pay them the overtime salary.
From India, Mumbai
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I am working in a small start-up pharma Pvt. Ltd. company with 10 employees and 2 office boys. I have a query regarding overtime calculation. Our office hours are from 9:30 am to 6:00 pm with a 40-minute lunch break in between. Sometimes, due to urgent work or submissions, we have to work extra hours, typically half an hour to one hour, and our office boys work an additional 3-4 hours.
I would like to know how to calculate this overtime or extra time worked and how to pay them the overtime salary.
From India, Mumbai
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Hi Sneha, If your company is classified as a 'factory' under the Factories Act, the following provisions shall apply:
"Sub-Sec (1) Sec. 59 of the Factories Act 1948 provides - where a worker works in a factory for more than 9 hours in any day or for more than 48 hours in any week, he shall, in respect of overtime work, be entitled to wages at the rate of twice his ordinary rate of wages. Sub-sec. (2) of Sec. 59 provides that 'ordinary rate of wages' means the basic wages plus such allowances, including the cash equivalent of the advantages through the concessional sale to workers of food grains and other articles as the worker is for the time being entitled to, but does not include a bonus and wages for overtime work."
You may calculate overtime payment eligible/due to these employees like this: (Basic Pay + DA /30) i.e., One day wages divided by 8 hrs. = 1 hour wages multiplied by 2 is twice the rate of OT. For this purpose, 'wages' would mean Basic Pay plus Dearness Allowance. In case these employees are paid a consolidated salary, either it shall be broken into Basic, DA, and other allowances or you have to take the full salary and calculate. If not a factory, single OT may be paid without multiplying by 2.
From India, Bangalore
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1272"Sub-Sec (1) Sec. 59 of the Factories Act 1948 provides - where a worker works in a factory for more than 9 hours in any day or for more than 48 hours in any week, he shall, in respect of overtime work, be entitled to wages at the rate of twice his ordinary rate of wages. Sub-sec. (2) of Sec. 59 provides that 'ordinary rate of wages' means the basic wages plus such allowances, including the cash equivalent of the advantages through the concessional sale to workers of food grains and other articles as the worker is for the time being entitled to, but does not include a bonus and wages for overtime work."
You may calculate overtime payment eligible/due to these employees like this: (Basic Pay + DA /30) i.e., One day wages divided by 8 hrs. = 1 hour wages multiplied by 2 is twice the rate of OT. For this purpose, 'wages' would mean Basic Pay plus Dearness Allowance. In case these employees are paid a consolidated salary, either it shall be broken into Basic, DA, and other allowances or you have to take the full salary and calculate. If not a factory, single OT may be paid without multiplying by 2.
From India, Bangalore
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