How overtime pay is calculated
Overtime is not just "extra hours" — it is a legal rate your employer must pay once you pass a set number of hours. Here is exactly how the maths works, federally and in the states with daily rules.
The federal rule: 40 hours, then time and a half
Under the Fair Labor Standards Act (FLSA), most hourly workers in the US must be paid 1.5 times their normal rate for every hour worked over 40 hours in a single workweek. The workweek is any fixed 7-day period your employer uses — it does not have to be Monday to Sunday, but it cannot be changed week to week to dodge overtime.
A worked example at $20 an hour
Say you work 45 hours in a week at $20/hour:
- Regular pay: 40 hours × $20 = $800
- Overtime pay: 5 hours × ($20 × 1.5 = $30) = $150
- Total gross pay: $950
The most common mistake is applying the regular rate to all 45 hours first ($900) and then wondering where the extra $50 went. The premium is the extra $10 on each overtime hour.
States with daily overtime
A few states go further and pay overtime by the day, not just by the week:
- California: 1.5× after 8 hours in a day, double time (2×) after 12 hours in a day, plus special rules for the seventh straight day of a workweek.
- Alaska: 1.5× after 8 hours in a day (for most employers).
- Colorado: 1.5× after 12 hours in a day or 12 consecutive hours.
- Nevada: daily overtime in some cases, mainly for lower-wage workers.
When both a daily and a weekly rule could apply to the same hour, you get whichever pays more for that hour — never both on top of each other. That is why the same 45-hour week can pay $950 under federal rules but $1,040 or more in California if the hours were worked in long days.
What does not count
Overtime is calculated on hours actually worked. Paid holiday, vacation and sick days usually do not count toward the 40 unless your employer or a union agreement says otherwise. Unpaid meal breaks are not work time; short rest breaks (under about 20 minutes) generally are.
The quick check
Add up each day first, apply your state's daily rule if it has one, then apply the 40-hour weekly rule to whatever is left. If your paycheck looks light, that order of operations is where the difference usually hides.
Try it free
Skip the hand maths — the Overtime Calculator does all of this automatically, with your state's rules built in.