Dear Friends,
Can you please guide me on how to calculate the normal overtime hour factor? What I know is:
Basic salary X 12 months / 365 days = 1 day average Basic Salary
1 day average basic salary / 8 hrs = 1 hr average basic salary
1 hr average basic salary X 1.5 Factor = 1 hr normal overtime cost.
Please tell me if this is the actual true formula. If not, please guide me to the best one.
Thanks & Regards,
Khaiser Ali Shah
00966509928983
From Saudi Arabia, Riyadh
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9Can you please guide me on how to calculate the normal overtime hour factor? What I know is:
Basic salary X 12 months / 365 days = 1 day average Basic Salary
1 day average basic salary / 8 hrs = 1 hr average basic salary
1 hr average basic salary X 1.5 Factor = 1 hr normal overtime cost.
Please tell me if this is the actual true formula. If not, please guide me to the best one.
Thanks & Regards,
Khaiser Ali Shah
00966509928983
From Saudi Arabia, Riyadh
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Come on guys no replies, please reply or send some suggestions. Just try to give me the way you calculate the payroll for your company.
From Saudi Arabia, Riyadh
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From Saudi Arabia, Riyadh
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Dear Mr. Shah,
In my opinion, you can calculate the overtime amount by fixing a certain rate for each hour of extra work and multiplying that rate by the number of hours of extra work performed. This calculation will provide you with the overtime amount earned by an employee. For example, if XYZ works for an extra 5 hours, and we have set a rate of 100 rupees per hour for overtime work, XYZ would be eligible for 100 * 5 = 500 Rs.
Regards,
Aparna
HR Professional
From India, Gurgaon
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In my opinion, you can calculate the overtime amount by fixing a certain rate for each hour of extra work and multiplying that rate by the number of hours of extra work performed. This calculation will provide you with the overtime amount earned by an employee. For example, if XYZ works for an extra 5 hours, and we have set a rate of 100 rupees per hour for overtime work, XYZ would be eligible for 100 * 5 = 500 Rs.
Regards,
Aparna
HR Professional
From India, Gurgaon
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Overtime Calculation
Per day salary Basic salary = (pertaining to the number of days in a month) = Basic/31 = Salary per day.
Per day basic / 8 = per hour salary.
Overtime = 1.25 * per hour salary * number of overtime hours worked.
Liz
From Australia, Adelaide
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Per day salary Basic salary = (pertaining to the number of days in a month) = Basic/31 = Salary per day.
Per day basic / 8 = per hour salary.
Overtime = 1.25 * per hour salary * number of overtime hours worked.
Liz
From Australia, Adelaide
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Thanks for reply Liza, I am looking for further suggestions so, come on friends give me the method of your overtime calculation. Once againg thanks to Liza, Khaiser
From Saudi Arabia, Riyadh
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From Saudi Arabia, Riyadh
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Overtime calculation varies from country to country depending on the factories act. In India, overtime is given as double the normal rate (Basic + DA) for the extra hours worked. If it is a 31-day duty, then the hourly rate is calculated as A/31/8. If it is a 26-day work period, then the hourly rate is calculated as A/26/8, and so on.
From United States, Cambridge
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From United States, Cambridge
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Dear Murali, That’s OK but it differs from company to company so please send me the one your company follows. Regards
From Saudi Arabia, Riyadh
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From Saudi Arabia, Riyadh
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Hi all,
Mr. Tiwari is right; overtime (OT) should be paid double the wages. When calculating the hourly wage, we should not consider 9 or 10 hours; we should only consider 8 hours because the Factories Act states that working hours should be 8 hours, including all intervals. Importantly, we should not allow an employee to work overtime exceeding 48 hours in 3 months.
Thank you.
From India, Bangalore
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Mr. Tiwari is right; overtime (OT) should be paid double the wages. When calculating the hourly wage, we should not consider 9 or 10 hours; we should only consider 8 hours because the Factories Act states that working hours should be 8 hours, including all intervals. Importantly, we should not allow an employee to work overtime exceeding 48 hours in 3 months.
Thank you.
From India, Bangalore
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Hi,
One company provides double overtime to its employees based on their gross salary. The question is why they use the gross salary for overtime calculation. For example, if the gross salary is $5000, working hours are 2, and the month is May:
$5000/31 = $161 (one day wage)
$161/8 = $20 per hour
$20 x 4 = $80 overtime pay
Using the gross salary for overtime calculation ensures that the extra pay is proportionate to the employee's overall earnings. This method aims to compensate employees fairly for their additional hours worked.
From India, New Delhi
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One company provides double overtime to its employees based on their gross salary. The question is why they use the gross salary for overtime calculation. For example, if the gross salary is $5000, working hours are 2, and the month is May:
$5000/31 = $161 (one day wage)
$161/8 = $20 per hour
$20 x 4 = $80 overtime pay
Using the gross salary for overtime calculation ensures that the extra pay is proportionate to the employee's overall earnings. This method aims to compensate employees fairly for their additional hours worked.
From India, New Delhi
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Dear Khaiser, The calculation you have stated s true,but plz look in to the actual(1.25 or 1.5) placed in saudi market Regards HR_HYD
From India, Hyderabad
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From India, Hyderabad
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In factories, while calculating the OT, sundays to be removed. basicwages/26/8 hrs. it should be double in India and 1.5 times in UAE
From India, Lucknow
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From India, Lucknow
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According to the Factories Act, I agree with Mr. K. Tiwari's opinion. Overtime is given at double the normal rate (Basic + DA) for the extra hours worked. If it is a 31-day duty, then the hourly rate is calculated as A/31/8. If it is a 26-day work schedule, then the hourly rate is calculated as A/26/8, and so on.
Average basic salary should only be considered on a monthly basis.
Venkat
From India, Bangalore
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Average basic salary should only be considered on a monthly basis.
Venkat
From India, Bangalore
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hi, overtime calculated with double rate of normal wages i.e. Basic+DA, my question is there no place for the allowances in Overtime?
From India, Delhi
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From India, Delhi
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I have good file for you related to overtime but an able to attached it give you email and I will mail it to you
From Bahrain
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From Bahrain
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Dear All,
As per the Factories Act 1948, the calculation of overtime wages is as follows:
Up to 9 hours per day or 48 hours per week, the rate is normal. Beyond that, the rate will be doubled.
Accordingly, calculate the difference between the scheduled working hours and the hours specified above. For the difference, the OT payment will be at a single rate and double for any excess hours. If there is a difference in the calculation on a daily and weekly basis, the employee should be paid based on whichever is more beneficial to them.
For example: A company works 6 days a week with a uniform working time of seven and a half hours per day (8 hours including a 30-minute break). Suppose a worker works an extra 2.5 hours, totaling 10 hours in a day, with a per hour remuneration of Rs. 30. The overtime payment calculation will be as follows:
1) Daily basis: Scheduled time - 7.5 hours
OT time @ normal rate - 9 - 7.5 = 1.5 hours
OT payment - 1.5 x 30 = Rs. 45 - (A)
OT time @ double rate - 10 - 9 = 1 hour
OT payment - 1 x 30 x 2 = Rs. 60 - (B)
Total - 45 + 60 = Rs. 105
2) Weekly basis: Scheduled time - 7.5 x 6 = 45 hours
OT time @ normal rate - 47.5 - 45 = 2.5 hours
OT payment - 2.5 x 30 = Rs. 75 - (A)
OT time @ double rate - 47.5 - 48 = N/A
OT payment - 0 x 30 x 2 = Rs. 0 - (B)
Total - 75 + 0 = Rs. 75
The higher amount is Rs. 105 (daily basis).
If the worker in the example above works an additional 2.5 hours for three days in the same week, the calculation will be as follows:
1) Daily basis: Scheduled time - 7.5 hours
OT time @ normal rate - 9 - 7.5 = 1.5 hours
OT payment - 1.5 x 3 x 30 = Rs. 135 - (A)
OT time @ double rate - 10 - 9 = 1 hour
OT payment - 1 x 3 x 30 x 2 = Rs. 180 - (B)
Total - 135 + 180 = Rs. 315
2) Weekly basis: Scheduled time - 7.5 x 6 = 45 hours
OT time @ normal rate - 48 - 45 = 3 hours
OT payment - 3 x 30 = Rs. 90 - (A)
OT time @ double rate - 52.5 - 48 = 4.5 hours
OT payment - 4.5 x 30 x 2 = Rs. 270 - (B)
Total - 90 + 270 = Rs. 360
The higher amount is Rs. 360 (weekly basis).
Abbas.P.S
From India, Bangalore
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As per the Factories Act 1948, the calculation of overtime wages is as follows:
Up to 9 hours per day or 48 hours per week, the rate is normal. Beyond that, the rate will be doubled.
Accordingly, calculate the difference between the scheduled working hours and the hours specified above. For the difference, the OT payment will be at a single rate and double for any excess hours. If there is a difference in the calculation on a daily and weekly basis, the employee should be paid based on whichever is more beneficial to them.
For example: A company works 6 days a week with a uniform working time of seven and a half hours per day (8 hours including a 30-minute break). Suppose a worker works an extra 2.5 hours, totaling 10 hours in a day, with a per hour remuneration of Rs. 30. The overtime payment calculation will be as follows:
1) Daily basis: Scheduled time - 7.5 hours
OT time @ normal rate - 9 - 7.5 = 1.5 hours
OT payment - 1.5 x 30 = Rs. 45 - (A)
OT time @ double rate - 10 - 9 = 1 hour
OT payment - 1 x 30 x 2 = Rs. 60 - (B)
Total - 45 + 60 = Rs. 105
2) Weekly basis: Scheduled time - 7.5 x 6 = 45 hours
OT time @ normal rate - 47.5 - 45 = 2.5 hours
OT payment - 2.5 x 30 = Rs. 75 - (A)
OT time @ double rate - 47.5 - 48 = N/A
OT payment - 0 x 30 x 2 = Rs. 0 - (B)
Total - 75 + 0 = Rs. 75
The higher amount is Rs. 105 (daily basis).
If the worker in the example above works an additional 2.5 hours for three days in the same week, the calculation will be as follows:
1) Daily basis: Scheduled time - 7.5 hours
OT time @ normal rate - 9 - 7.5 = 1.5 hours
OT payment - 1.5 x 3 x 30 = Rs. 135 - (A)
OT time @ double rate - 10 - 9 = 1 hour
OT payment - 1 x 3 x 30 x 2 = Rs. 180 - (B)
Total - 135 + 180 = Rs. 315
2) Weekly basis: Scheduled time - 7.5 x 6 = 45 hours
OT time @ normal rate - 48 - 45 = 3 hours
OT payment - 3 x 30 = Rs. 90 - (A)
OT time @ double rate - 52.5 - 48 = 4.5 hours
OT payment - 4.5 x 30 x 2 = Rs. 270 - (B)
Total - 90 + 270 = Rs. 360
The higher amount is Rs. 360 (weekly basis).
Abbas.P.S
From India, Bangalore
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Hi,
The formula for overtime calculation is wages which they get per day/8 * No. of Hrs. OT * 2.
Thanks and Regards,
Manjunath
Human Resources
PSK Engg. Pvt. Ltd.
Mob: 9980342847
Find more information at https://www.citehr.com/69550-overtim...#ixzz16NdpxULa
From India, Kochi
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The formula for overtime calculation is wages which they get per day/8 * No. of Hrs. OT * 2.
Thanks and Regards,
Manjunath
Human Resources
PSK Engg. Pvt. Ltd.
Mob: 9980342847
Find more information at https://www.citehr.com/69550-overtim...#ixzz16NdpxULa
From India, Kochi
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Dear Manjunath,
As per the Factories Act, I have furnished the details on the calculation of overtime payment. Accordingly, the difference between 9 hours per day and the daily scheduled time or 48 hours and the weekly scheduled time, as the case may be, normal wages will be paid. Beyond this, it will be double; i.e., the overtime payment will be a mixture of normal and double rates.
However, according to you, it is double the normal rate for the whole overtime. Please share how we can bypass the Factory Act and what is the alternate legislation for your calculation?
Abbas P.S
From India, Bangalore
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As per the Factories Act, I have furnished the details on the calculation of overtime payment. Accordingly, the difference between 9 hours per day and the daily scheduled time or 48 hours and the weekly scheduled time, as the case may be, normal wages will be paid. Beyond this, it will be double; i.e., the overtime payment will be a mixture of normal and double rates.
However, according to you, it is double the normal rate for the whole overtime. Please share how we can bypass the Factory Act and what is the alternate legislation for your calculation?
Abbas P.S
From India, Bangalore
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i want to know that if i work on monday tuesday and wednesday from 9am to 9pm daily and after that i take leave from company from my annual leaves so how my overtime will be calcualte please reply
From Pakistan, Karachi
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From Pakistan, Karachi
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Dear Concerned,
As per the Factories Act, we can only have overtime work for a maximum of one hour daily, and the payment will be for two hours (i.e. double).
Calculations: Total Wages (All-Inclusive) / 208 x OT Hours x 2. (where 208 = 26 days x 8 hours)
This payment for overtime will attract ESI contribution (if applicable) and not PF contribution.
V K Gupta
From India, Panipat
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As per the Factories Act, we can only have overtime work for a maximum of one hour daily, and the payment will be for two hours (i.e. double).
Calculations: Total Wages (All-Inclusive) / 208 x OT Hours x 2. (where 208 = 26 days x 8 hours)
This payment for overtime will attract ESI contribution (if applicable) and not PF contribution.
V K Gupta
From India, Panipat
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Dear All,
As per the Factories Act, a person who has worked more than 9 hours in a day and 48 hours in a week should be paid double overtime. The calculation is as follows:
Basic + D.A / 26 / 8 * OT Hrs * 2
Suppose the Basic + D.A is Rs. 15,000 and the OT is 45 hours, then the calculation will be:
15,000 / 26 = 577
577 / 8 = 72
72 * 45 * 2 = 6,480
From India, Bangalore
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As per the Factories Act, a person who has worked more than 9 hours in a day and 48 hours in a week should be paid double overtime. The calculation is as follows:
Basic + D.A / 26 / 8 * OT Hrs * 2
Suppose the Basic + D.A is Rs. 15,000 and the OT is 45 hours, then the calculation will be:
15,000 / 26 = 577
577 / 8 = 72
72 * 45 * 2 = 6,480
From India, Bangalore
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Hi Rjneesh, in the above formula Basic+D.A/26/8*OT Hrs*2. what is tht 2 refers too. Regards, Jagdish.
From India, Hyderabad
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From India, Hyderabad
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Dear Jagdish Ji, 2 refers to double the OT Hrs. Regards Rajnish
From India, Bangalore
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From India, Bangalore
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Dear Mr. Khaiser Ali,
Please note the Overtime Calculation formula is as follows:
Basic / 26 / 8 * number of OT hours * 2.
This is because if the workers work beyond their regular hours, we are required to compensate them with double wages.
Thank you for your attention to this matter.
Thanks & Best Regards,
Ambika
From India, undefined
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Please note the Overtime Calculation formula is as follows:
Basic / 26 / 8 * number of OT hours * 2.
This is because if the workers work beyond their regular hours, we are required to compensate them with double wages.
Thank you for your attention to this matter.
Thanks & Best Regards,
Ambika
From India, undefined
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