How to calculate overtime in India (2026)
In India, overtime is paid at twice the ordinary rate of wages for every hour worked beyond the working-hour limit. Under the Occupational Safety, Health and Working Conditions Code, in force since 21 November 2025, a worker can be asked to work up to 48 hours a week, and overtime needs the worker’s consent.
The rules in short
- Weekly limit: 48 hours. Hours beyond the limit are overtime.
- Overtime rate: twice the ordinary rate of wages.
- Consent: overtime can only be worked with the worker’s consent.
- Daily hours and quarterly overtime cap: set by your state’s rules. Where a state has not yet notified rules under the new codes, its older rules, such as the Shops and Establishments Act, still apply.
What counts as the “ordinary rate of wages”
Overtime is worked out on wages as defined in the Code on Wages: basic pay, dearness allowance (DA) and retaining allowance. Allowances such as HRA and conveyance are left out. If those allowances add up to more than half of total pay, the part above half is added back to wages.
The formula
Hourly rate = monthly wages ÷ (working days in the month × working hours a day)
Overtime pay = hourly rate × 2 × overtime hours
Many companies use 26 working days and 8 hours a day, which means dividing monthly wages by 208.
Example
| Step | Working | Amount |
|---|---|---|
| Monthly wages (basic + DA) | ₹15,600 | |
| Hourly rate | ₹15,600 ÷ (26 × 8) | ₹75 |
| Overtime rate | ₹75 × 2 | ₹150 an hour |
| Overtime pay for 10 hours | ₹150 × 10 | ₹1,500 |
How Crew does it
Crew counts the hours each employee works beyond their shift from biometric, selfie or geo-fence punches, applies the overtime rate you set, and adds overtime to that month’s payroll with PF, ESI, PT and TDS. See attendance and payroll.
Frequently asked questions
What is the overtime rate in India?
Twice the ordinary rate of wages for each hour of overtime, under the Occupational Safety, Health and Working Conditions Code and the older Factories Act.
How many hours a week can employees work in India?
Up to 48 hours a week under the labour codes in force since 21 November 2025. Hours beyond that are overtime, paid at twice the ordinary rate. Daily limits and the quarterly overtime cap are set by state rules.
Can an employee refuse overtime?
Under the Occupational Safety, Health and Working Conditions Code, overtime can only be worked with the worker’s consent.
Is overtime pay counted for PF?
No. Overtime allowance is not part of “wages” under the Code on Wages, so PF is worked out on basic pay and DA without it. Overtime is still taxed as salary.
