Result
- Total hours
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- Regular hours
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- Overtime hours
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- Regular pay
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- Overtime pay
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- Gross pay
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- Employer costs
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- Cost per labor hour
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Overtime is calculated per person per week. Overtime rules vary by location and some states also have daily overtime - set the rules that apply to you. Gross pay only; not payroll or tax advice.
How weekly overtime is calculated
For each person, hours up to the overtime threshold are paid at their regular rate, and hours above it are paid at the rate times the overtime multiplier. With a 40-hour threshold and a 1.5x multiplier, someone earning $20 an hour who works 46 hours gets 40 x $20 = $800 regular pay plus 6 x $30 = $180 overtime pay, for $980 gross.
overtime hours = max(0, hours - threshold)
gross pay = regular hours x rate + overtime hours x rate x multiplier
labor cost = gross pay x (1 + employer cost %)
In the US, the federal Fair Labor Standards Act generally requires overtime at one and a half times the regular rate for hours over 40 in a workweek for non-exempt employees (U.S. Department of Labor). Some states have additional rules, such as daily overtime, so check what applies to you.
Your labor cost is more than wages
On top of gross pay, employers typically pay payroll taxes and often workers' compensation insurance and other costs. These vary by location, industry and payroll provider, so this calculator doesn't assume a number: enter the percentage your payroll provider or accountant gives you to see a fuller cost per labor hour.
Why cost per labor hour matters for pricing
When you quote a job using crew hours, the cost per labor hour - including overtime and employer costs - is what each estimated hour really costs you. If your quotes assume a lower number, overtime weeks quietly erase your profit. Use this figure in the job profit margin calculator.
Keep overtime visible
A little overtime can be cheaper than hiring. A lot of it, every week, usually means schedules are too tight or jobs are under-quoted. Logging shifts and reviewing weekly totals shows the pattern early.
From one week to every week
A calculator is good for a quick check. For ongoing payroll prep, it's easier to log each shift once (time in, time out, break, job) and let a spreadsheet total weekly hours, overtime and gross pay - plus labor cost per job.
FAQ
How do I calculate overtime pay?
Multiply overtime hours by the regular hourly rate and the overtime multiplier. With a 1.5x multiplier, each overtime hour costs 1.5 times the normal rate. Add regular pay to get gross pay.
What counts as overtime?
Under US federal law, generally hours over 40 in a workweek for non-exempt employees. Some states also require daily overtime or have other rules, and rules differ in other countries. Set the threshold and multiplier that apply to you.
Does this calculate taxes and deductions?
No. It calculates gross pay and an optional employer-cost percentage you enter. Withholding and payroll taxes depend on your location and should come from your payroll provider or accountant.
What is cost per labor hour?
Total labor cost (gross pay plus employer costs) divided by total hours worked. It's the number to use when you estimate jobs by crew hours.