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Use this overtime salary calculator to work out your OT pay in seconds, based on the double-wage rate that Indian labor law sets under the Factories Act, 1948.

Overtime Rules by Sector

Overtime law in India isn't one law. Which statute covers you, and what rate you're owed, depends on your industry and sometimes your state. Here's how it breaks down across five sectors.

1. Manufacturing and Factory Workers

Governed by the Factories Act, 1948, Sections 54-59.

Example: Pune auto-parts factory worker

Monthly salary ₹28,000, OT hours 45, working days 22 x 8 hrs.

• Hourly wage = ₹28,000 ÷ 176 = ₹159.09/hr
• OT rate (2x) = ₹159.09 x 2 = ₹318.18/hr
• Total OT pay = 45 x ₹318.18 = ₹14,318.18
• Monthly income with OT = ₹42,318.18

The Factories Act applies directly here, so this worker is fully protected under Section 59.

Factory workers get the strongest protection under Indian labor law. Employers have to keep Form 10, the Overtime Register, under the Factories Act Rules. The employer compliance section below covers exactly what that register needs to include.

2. IT and Software Employees

Governed by state Shops & Establishments Acts, and eventually the OSH Code 2020 once it's notified.

IT and software staff working in offices, not factories, fall under their State Shops and Establishments Act rather than the Factories Act. Rules differ by state. Karnataka's Shops and Commercial Establishments Act spells out OT provisions clearly; other states are vaguer.

Example: Bengaluru software developer, product launch crunch

Monthly salary ₹90,000, OT hours 35.

• Hourly wage = ₹90,000 ÷ 176 = ₹511.36/hr
• OT rate (2x) = ₹511.36 x 2 = ₹1,022.73/hr
• Total OT pay = 35 x ₹1,022.73 = ₹35,795.45
• Monthly income with OT = ₹1,25,795.45

Here's where a lot of IT employees get confused: many companies pay CTC-based "flexible benefits" instead of OT. That's only legal if it's clearly agreed in writing, and it can't reduce what you're owed as minimum OT entitlement.

Once the Occupational Safety, Health & Working Conditions Code 2020 is fully notified, it'll bring OT rules for IT and service workers under one national framework. More on that in the 2025-26 update section below.

3. Healthcare Workers and Nurses

Governed by the Factories Act (public hospitals), the State Shops Act (private hospitals), or state-specific Nursing Rules, plus the Clinical Establishment Act 2010.

Example: Mumbai private hospital staff nurse

Monthly salary ₹45,000, regular OT 20 hrs, night-shift OT 12 hrs at 2.5x.

• Hourly wage = ₹45,000 ÷ 176 = ₹255.68/hr
• Regular OT (2x) = 20 x ₹511.36 = ₹10,227.27
• Night OT (2.5x) = 12 x ₹639.20 = ₹7,670.45
• Total OT = ₹17,897.73, monthly total = ₹62,897.73

Nurses in government hospitals sometimes fall under separate state service rules that structure OT differently. If you're unsure which applies, check with HR or your state nursing council directly.

4. Retail and Sales Staff

Governed by state Shops & Establishments Acts, each state having its own version (Maharashtra Shops Act 1948, Delhi Shops Act 1954, Tamil Nadu Shops Act 1947).

Example: Delhi mall sales executive, festive season

Monthly salary ₹35,000, OT hours (October-November) 60.

• Hourly wage = ₹35,000 ÷ 176 = ₹198.86/hr
• OT rate (2x) = ₹198.86 x 2 = ₹397.73/hr
• Total OT pay = 60 x ₹397.73 = ₹23,863.64
• Monthly income with OT = ₹58,863.64

One thing sales staff often get wrong: target-based incentives or commissions don't replace OT pay. You're owed both, separately.

5. Government Employees

Governed by Central or State Government Service Rules, which sit entirely outside the Factories Act or Shops Act framework.

Central government employees follow Supplementary Rules (SR) 2B and the Overtime Allowance Rules notified under the relevant Pay Commission.

Example: Central government clerk, non-gazetted, Group C

OTA rate under DoPT OM, post-7th Pay Commission, is roughly ₹19-27/hr for Group C staff. At 30 OT hours:

• OTA = 30 x ₹27 = ₹810/month

Government OTA rates sit well below the private sector's 2x rate. That gap is a known and often-discussed disparity in Indian labor policy.

Verify the latest DoPT OTA circular for your pay level at dopt.gov.in.

Not sure which sector applies to you? Use this overtime salary calculator with the 2x rate as your baseline if you're in the private sector. Once you've worked out your OT entitlement, check your actual take-home after taxes with our salary tax calculator. Factory workers should also check whether they qualify for benefits using our ESIC eligibility checker.

Overtime Compliance for Employers

Getting overtime right isn't just good practice, it's a legal requirement with real financial penalties attached. This section is for HR managers, payroll teams, and business owners who need to stay compliant with Indian overtime law.

Form 10: The Overtime Register

Under the Factories Act, 1948 and its State Rules, every factory employer must maintain Form 10, the Register of Adult Workers, along with a separate overtime record. This isn't optional paperwork. It's a statutory register that inspectors can demand on the spot.

Form 10 needs to capture, per worker, per day:

• Name and token/badge number of the worker
• Department and nature of work
• Time of commencement and ending of each period of work
• Total hours worked, regular and overtime listed separately
• Overtime hours for the week and the cumulative month total
• Signature or thumb impression of the worker for each day
• Overtime wages calculated and paid, ₹ amount per period
• Manager countersignature for each entry

Form 10 has to be preserved for at least 3 years after the last entry. Digital records work in most states, as long as they can be printed on demand and are authenticated. Missing or falsified Form 10 entries can lead to criminal liability for the factory manager under Section 92 of the Factories Act.

Shops & Establishments workers (IT, retail, services) have an equivalent register under their state's Shops Act Rules, usually called the "Register of Employment" or "Attendance-cum-Wage Register."

Getting Overtime Right on Payslips

The Code on Wages, 2019 (Section 17) and the Payment of Wages Act require employers to issue a wage slip showing the full breakdown of earnings. For overtime workers, a compliant payslip needs:

Required line items

• Basic salary / basic pay
• Dearness Allowance, if any
• Overtime hours worked (number)
• Overtime pay rate (per hour)
• Total overtime pay (₹ amount)
• Other allowances (HRA, TA, etc.)
• Gross salary, including OT
• All deductions (PF, ESI, PT, TDS)
• Net take-home salary

Common violations

• Merging OT into "Other Allowances" without disclosure
• Showing OT hours but not the rate used
• Underpaying by using 1x instead of 2x
• Capping OT at a flat ₹ amount regardless of hours worked
• Rolling unpaid OT into next month without written consent
• Not issuing payslips at all

Run the numbers through this overtime calculator before payroll goes out. Punching in monthly salary and OT hours takes half a minute and heads off calculation disputes before they start. For the full salary-to-take-home picture, including PF and ESI deductions, our salary tax calculator covers that too.

Penalties Under the Code on Wages, 2019

The Code on Wages, 2019 folds in the Payment of Wages Act, Minimum Wages Act, Bonus Act, and Equal Remuneration Act, and it tightened penalty provisions for wage non-compliance, including overtime underpayment.

Worth flagging for HR teams: Factories Act Section 92 and Code on Wages 2019 Section 54 penalties can both apply to the same violation if it breaches both statutes. Factory managers named on the factory license can face personal criminal liability, not just the company. That's exactly why a payroll audit is a business-critical activity, not a box-ticking one.

Quarterly HR Payroll Audit Checklist

Run this quarterly, before a labor inspection finds the gaps first.

• Attendance vs payroll cross-check. Pull biometric or swipe data for each employee and compare total hours against payslip OT line items. A one-hour discrepancy, multiplied by the 2x rate across 100 employees, adds up to a real arrear liability fast.
• OT rate verification. Confirm your payroll software applies exactly 2x the ordinary hourly wage (monthly salary ÷ standard hours). Some HRMS platforms default to 1.5x, which is wrong for India, so check and fix it.
• State monthly cap compliance. Flag anyone who went over the state limit (50-75 hrs) in any given month, and confirm labor authority approval exists for those months.
• Form 10 completeness. Every mandatory column filled, countersigned, and matched against payroll data for the last 12 months.
• Rest day and holiday OT rates. Confirm Sunday and notified-holiday work was paid at 2.5x-3x, not the standard 2x.
• TDS on OT income. Overtime pay has to sit inside gross salary for TDS purposes, it can't be excluded as a "special allowance." Check the correct TDS for each salary band with our income tax calculator.
• Employee awareness. Workers need to have been told their OT rate and monthly limit, usually through a notice board or written communication, which most State Rules require.

The OSH Code 2020: Overtime Changes for 2025-26

As of April 2026, the four Labour Codes, including the Occupational Safety, Health and Working Conditions (OSH) Code, 2020, have been passed by Parliament but aren't fully notified for enforcement yet. Most states haven't issued final rules either. Until that happens, the Factories Act, 1948 stays in force. Keep an eye on the Ministry of Labour website for notification updates.

Current rules (Factories Act, 1948)

• OT limit measured monthly
• Typically 50-75 hrs/month by state
• OT rate: 2x ordinary wage (Section 59)
• Applies to factories; IT/services use Shops Acts
• Spread-over limit: 10.5 hrs/day including OT

Upcoming rules (OSH Code 2020, once notified)

• OT limit shifts to a quarterly basis
• 125 hours per quarter (Maharashtra Model Rules draft)
• OT rate stays at 2x ordinary wage, no reduction
• Broader coverage, IT and service workers included
• Daily work limit: 12 hours per day including OT

What this actually means for workers

1. The quarterly limit creates a seasonal trap. Under the monthly system, 75 hours in November is your cap, full stop. Under a quarterly system, 125 hours across October to December is the total. That means an employer could ask for 80 hours in December if October and November only added up to 45. Track your quarterly running total, not just the month.
2. The 2x rate isn't going anywhere. Section 25 of the OSH Code mirrors Section 59 of the Factories Act. No employer gets to point to Code implementation as a reason to cut your OT rate.
3. IT and service workers gain real statutory protection. The OSH Code's wider reach brings IT parks, call centres, hospitals, and retail under one overtime framework for the first time, a meaningful expansion for roughly 5 crore service-sector workers.
4. State rules will matter more, not less. The OSH Code gives states real leeway to set their own overtime limits within the central framework. Read your state's rules carefully once they land; the Maharashtra Model Rules draft is currently the most developed reference.
5. Digital time-keeping may become mandatory. Draft rules in several states propose compulsory electronic attendance systems above a certain establishment size. It's worth keeping screenshots or exports of your digital attendance records regardless.

Whether or not the OSH Code is notified in your state yet, keep tracking overtime monthly the way you do now. The 2x calculation this overtime salary calculator uses stays correct either way. If growing overtime income is pushing you into a different tax bracket, our old vs new tax regime calculator is worth a look, especially if the OSH Code ends up raising your permitted OT hours.

How India's Overtime Rate Compares Globally

Useful context if you're an Indian professional at a multinational, an HR team managing global payroll, or someone who's worked abroad and wants to understand their rights back home.

India's mandatory 2x overtime rate is one of the highest in the world for manufacturing and industrial workers, ahead of the US (1.5x), UAE (1.25x-1.5x), and Singapore (1.5x). The gap in India isn't the law itself, it's enforcement. The rules are strong; awareness and compliance monitoring among workers still lag behind.

If you're an Indian professional at an Indian subsidiary of a US or UK company, it's Indian labor law that applies to your employment, not US or UK law. Your OT entitlement runs through the Factories Act or the relevant state Shops Act, whichever covers your establishment.

For NRIs or returnees comparing earnings across countries, our foreign income tax calculator can help you work out the Indian tax side of things.

FAQ: Employer and HR Edition

1. What registers must an employer maintain for overtime?

Factory employers maintain Form 10 under the Factories Act and its State Rules, showing daily start/end times, total hours, OT hours separately, wages paid, and the worker's signature. It has to be kept for at least 3 years and produced for any labor inspector on demand.

Shops and Establishments employers maintain the equivalent, usually an Attendance-cum-Wage Register or Register of Employment. Under the Code on Wages, 2019 (Sections 13 and 14), all employers also have to issue wage slips with a clear overtime line item.

Failing to maintain these registers is punishable independently under both the Factories Act (Section 92) and the Code on Wages (Section 54), even when overtime was actually paid correctly.

2. Can overtime be paid as comp-off instead of wages?

This trips up a lot of employers. Under Section 59 of the Factories Act, overtime has to be paid in wages at double the ordinary rate. Compensatory off isn't a valid substitute under this Act. An employer offering comp-off instead of OT wages is technically non-compliant, even if the worker agrees to it.

In practice, plenty of IT and service-sector employers run comp-off policies, and some state Shops Acts leave this area vague. The safer approach: pay the overtime wages first, then offer comp-off as an extra benefit if your policy allows.

Once the OSH Code 2020 is notified, this position is expected to hold, overtime wages remain mandatory and comp-off can only supplement, not replace, them. HR teams should get this into written policy rather than leaving it to verbal agreements.

3. Is overtime pay included in PF calculations?

No. Overtime pay sits outside the PF wage base under the Employees' Provident Funds and Miscellaneous Provisions Act, 1952. "Basic wages" under the EPF Act doesn't include overtime earnings, so employers don't deduct the 12% PF contribution on OT, and there's no matching employer contribution required either.

That said, overtime is included in gross salary for income tax and TDS purposes. ESIC calculations also generally exclude overtime from "wages" for contribution purposes, though interpretations have varied by state, so it's worth checking current ESIC circulars. Our ESIC contribution checker can help you verify thresholds for your workforce.

4. How should overtime be treated in the Full and Final Settlement?

All unpaid overtime has to be included in the FnF on an employee's last working day, or within the timeline state law sets (often within 2 working days under some state Shops Acts). Leaving overtime arrears out of FnF counts as wage theft under the Code on Wages, 2019.

Run an OT reconciliation as a standard part of every FnF, comparing attendance data against every payslip from the full employment period. Small, consistent underpayments add up, and some state rules attach interest liability to the arrears.

Overtime paid in FnF is taxable in the year it's received and needs to show up in Form 16. Check the tax impact with our salary tax calculator.

5. How do employers get approval for overtime beyond the state monthly limit?

When business needs push overtime past the state cap (50-75 hours/month), the employer needs prior written approval from the Chief Inspector of Factories or the equivalent labor authority. The application typically needs to cover:

• The reason for excess overtime (urgent orders, seasonal demand, plant emergency)
• The specific departments and number of workers involved
• Estimated additional hours per worker per month
• Confirmation that 2x wages will be paid in full

Approval is discretionary and usually time-limited, 3-6 months. Operating over the limit without it exposes both the company and the named factory manager to personal liability under Section 92 of the Factories Act.

6. Can an employer deduct overtime pay for disciplinary reasons?

No, and this one is explicitly illegal. Overtime pay is a wage entitlement, not a discretionary bonus that can be adjusted for performance or conduct. Section 18 of the Code on Wages, 2019 permits deductions only for specific, defined purposes, fines, absence, housing loans, PF/ESI, advance recovery, and a short list of others. Disciplinary deductions from OT aren't on that list.

Withholding OT as a disciplinary measure opens the employer up to a complaint under both the Code on Wages and the Factories Act, and to an unfair labor practice complaint if the worker's unionised. Keep disciplinary processes and wage payment strictly separate.

7. How should HRMS or payroll software be configured for overtime?

A few configuration mistakes cause most OT underpayment:

• Wrong hourly base. Some HRMS systems default to 30 days x 8 hours = 240 hours instead of actual working days (say, 22 x 8 = 176). That understates the hourly rate by roughly 27% and underpays OT badly. Fix it to your actual working days per month.
• Wrong OT multiplier. Systems sometimes default to 1.5x, the US FLSA standard, instead of India's mandatory 2x. Double-check the multiplier in your configuration.
• OT excluded from gross for TDS. Some systems treat OT as non-taxable. It has to be part of taxable gross salary.
• Missing rest-day differential. Most HRMS setups don't have separate logic for Sunday or holiday work. Add a "Rest Day OT" component at 2.5x-3x to capture that.

Spot-check your HRMS output monthly against this overtime salary calculator, using a sample of employees across salary bands. If the numbers don't match, fix the configuration before the next payroll run.

8. What does a labor inspector check during an audit?

During a Factories Act or Shops Act inspection, expect the inspector to check:

• Form 10 (OT Register), the primary document, cross-checked against attendance records
• Wage/salary registers, to confirm OT was paid at the correct 2x rate as a separate line item
• Time cards or biometric attendance data, cross-referenced against Form 10
• Payslips, sample-checked for separate OT hours and rate
• Bank transfer records, increasingly checked to confirm wages actually moved, not just appeared on paper
• Approval letters for excess OT, required for any employee who went over the state monthly limit

Inspectors typically look at the last 12-24 months. Keeping all of this in order, ideally through a quarterly HR audit, costs far less than post-inspection penalties and arrear orders.