Overtime pay calculator

What the result means

Overtime pay is extra hours priced at a multiple of your ordinary hourly rate. This page keeps the two blocks separate: ordinary hours at the ordinary rate, plus overtime hours at that rate times a multiplier you choose, added together as gross pay before tax. The multiplier is the whole story, and it comes from your award, enterprise agreement or contract — not from this page. Nothing here decides when overtime starts, whether a meal break is paid, or whether other penalties apply on top.

How it is calculated

Total = ordinary hours × rate + overtime hours × rate × multiplier

• Ordinary hours: Hours paid at the plain rate. Enter them separately from the overtime hours.
• Ordinary rate: Your base hourly rate before any loading or penalty.
• Overtime hours: Hours worked beyond ordinary hours, as your award defines them.
• Multiplier: 1.5 is time-and-a-half, 2 is double time. Your award or agreement sets it.

The two terms are kept apart because overtime is priced against the ordinary rate, not stacked onto a running total. Adding the overtime hours to the ordinary hours first and then applying a multiplier would inflate the ordinary hours as well, which no award does. Keeping the blocks separate also lets you re-run the calculator for a second overtime tier and simply add the results.

Worked example

38 ordinary hours at $40, plus four hours at time-and-a-half

Dan is paid $40 an hour. He works his ordinary 38-hour week and is asked to stay back for four extra hours, which his agreement pays at time-and-a-half.

Ordinary pay

38 × $40 = $1,520

Overtime hourly rate

$40 × 1.5 = $60

Overtime pay

4 × $60 = $240

Gross for the week

$1,520 + $240 = $1,760

The four extra hours add $240 rather than the $160 they would be worth at the plain rate. If the same four hours were all at double time the overtime block would be $320 and the week $1,840; if the agreement paid two hours at 1.5 and two at double time it would be $120 + $160 = $280, for a week of $1,800. Employer super is generally calculated on the $1,520 only.

What a multiplier actually does to your hourly rate

A multiplier of 1.5 — time-and-a-half — means each overtime hour is paid at 150% of the ordinary rate. On a $40 ordinary rate that is $60 an hour, so four overtime hours are $240, not $160. The useful way to think about it is that time-and-a-half buys you an extra half hour's pay for every hour worked; double time buys you an extra full hour. At $40 an hour, four hours at double time is $320.

Because the multiplier is applied only to the overtime block, the ordinary hours in the first field are untouched. That matters when you are checking a payslip: if the gross looks wrong, work out the two blocks separately before assuming the rate is wrong. It is also why tiered overtime works — see below.

Penalty rates vary enormously between awards

Australia has well over a hundred modern awards, and they do not agree on overtime. A common pattern is time-and-a-half for the first two or three hours and double time after that, with different rules again on Saturdays, Sundays and public holidays, but plenty of awards do something else entirely. Some pay a flat loading, some pay a rest-break penalty if you are not given enough time between shifts, and some annualise the lot into a salary. Whether the casual loading compounds with an overtime multiplier or is absorbed into it is award-specific too.

Tiered overtime is easy to handle here: run the calculator once for each tier. Two hours at 1.5 on a $40 rate is $120, and the next two hours at double time are $160, so four hours split that way are $280 rather than the $240 a flat 1.5 would give. Put the ordinary hours in only the first run so you do not count them twice.

Time off in lieu instead of payment

Many awards allow overtime to be taken as time off in lieu rather than paid, by written agreement between the employee and employer for each occasion. Where an award permits it, the usual arrangement is an hour of time off for each hour of overtime worked, which is worth less than the multiplier — an hour off in exchange for an hour that would have been paid at 1.5 is a 50% discount on that hour.

That is not necessarily a bad trade, but it should be a conscious one. Use this page to price what you are giving up: at $40 an hour, banking four hours at time-and-a-half instead of taking the $240 means the time off needs to be worth at least that much to you. Awards also generally require untaken time in lieu to be paid out, often at the overtime rate, if it is not used within a set period.

Overtime and superannuation are usually separate

Superannuation Guarantee contributions are calculated on ordinary time earnings, and overtime is generally excluded from that definition — so the extra $240 in the worked example below typically attracts no employer super, while the $1,520 of ordinary pay does. There are exceptions, most obviously where the hours actually worked cannot be distinguished from ordinary hours, or where an agreement defines the ordinary hours more broadly.

The practical consequence is that a week padded with overtime raises take-home pay by more than it raises retirement savings. If you want to see the super side, run your ordinary earnings through the super calculator rather than the total from this page, and use the salary conversion calculator if you need to compare a weekly gross against an annual figure.

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