Overtime pay or overtime salary is the rate of payment employees receive for working overtime (OT) in a company, in addition to their regular working hours. For instance, if the standard working hours in your state are 40 hours a week and you work for 50 hours instead, then the 10 hours spent will be counted as overtime. And you will get extra payment for it.

The purpose of the overtime hours is to ensure fair compensation for all employees. This also ensures that companies comply with labor laws. However, the payment can differ depending on the industry they are working in, and the kind of work they do.

Employees must also be aware of unpaid overtime. If an employer is not paying overtime, then employees should know how to file an unpaid wages claim if compensation is denied.

Some benefits such as holiday pay or vacation pay overtime may also apply depending on employment contracts and state rules.

Frequently Asked Questions

Q1.	What is overtime pay?
Ans.	This is the payment you receive for working extra time beyond the standard working hours.
Q2.	Who is eligible for overtime pay?
Ans.	According to the Fair Labor Standards Act (FLSA), in USA, an employee is entitled to get overtime if they are covered as a salary non-exempt employee. They subsequently qualify for overtime pay if they work more than 40 hours during the work week. In India, if an employee works more than the standard working hours, which is usually 9 hours a day or 48 hours a week, then they are eligible for OT, as per the Factories Act, 1948.
Q3.	How is overtime pay calculated?
Ans.	In India, there are two methods of overtime hours calculation, one is for salaried employees and the other for hourly employees. For salaried employees: OT = 2 x [Basic Salary + DA + any other allowance / (Total number of working days in a month) x Maximum working hours in a day)] x Total overtime hours For Hourly employees: OT = 2 x [Basic Salary / (Total number of working days in a month) x (Maximum working hours in a day)] x Total overtime hours In the USA, according to the FLSA overtime rate for non-exempt workers must be at least 1.5 times the amount of your hourly pay rate.
Q4.	What counts as overtime hours?
Ans.	In the United States, overtime laws are governed by the Fair Labor Standards Act (FLSA). It mandates that employers compensate non-exempt workers at least 1.5 times their regular rate for any hours beyond 40 in a workweek. However, this does not cover the exempt employees. The Factories Act of 1948, which specifies a normal workweek of 48 hours, is the main source of India’s overtime policy and laws. Work beyond nine hours per day or forty-eight hours per week is considered overtime and is subject to compensation twice the regular rate (200%).
Q5.	Is overtime pay mandatory?
Ans.	In India, under the Factories Act, 1948, overtime pay is compulsory for eligible employees who work more than 9 hours in a day or 48 hours in a week. In the U.S., under the Fair Labor Standards Act (FLSA), overtime pay is mandatory for non-exempt employees who work more than 40 hours in a week.
Q6.	What is holiday overtime pay?
Ans.	According to the federal overtime law, it is the extra compensation an employee receives for working on a public holiday, festival, or company-declared holiday.