How to Calculate Overtime: Step-by-Step Guide
To work out how to calculate overtime, take your award or agreement hourly rate, multiply it by the overtime rate that document sets, then multiply by the overtime hours worked. The National Employment Standards set 38 ordinary hours a week for full-time employees plus reasonable additional hours, but the overtime rates themselves come from the award or enterprise agreement.
Modern award minimum rates rose 4.75% from the first full pay period starting on or after 1 July 2026, so an old rate gives the wrong answer. Your classification, employment type, the day and time worked and your award all change the result. See minimum wage in Australia for the wider pay picture.
How to calculate overtime: rates and rules
The table shows the structure of an overtime calculation. Where a dollar rate or multiplier is not listed, take it from your own pay guide.
| Item | What the rule is | Where to confirm it |
|---|---|---|
| Ordinary hours | 38 per week for a full-time employee, plus reasonable additional hours | National Employment Standards, Fair Work Ombudsman |
| Overtime rate | Set by the award or enterprise agreement, often as a multiple of the ordinary hourly rate that rises for later hours or weekends | Pay guide, overtime section |
| Award minimum rates | Rose 4.75% from the first full pay period starting on or after 1 July 2026 | Fair Work Ombudsman pay guide |
| National minimum wage | $26.44 per hour or $1,004.90 per 38-hour week from 1 July 2026, for award-free employees | Fair Work Ombudsman minimum wage page |
| Casual loading | 25% under most awards, and at least $33.05 per hour for award-free casuals on the national minimum wage | Pay guide, casual section |
| Penalty rates | Extra pay for weekends, nights and public holidays, set by the award | Pay guide, penalty rates section |
| Time off instead of pay | Allowed only where the award or agreement permits it and the employee agrees | Award or enterprise agreement |
On a busy site, a late finish on a Friday can mean overtime and a weekend rate in the same pay run, so check both columns.
How to calculate overtime for each employment type
Overtime depends on how you are employed. The table lists what to check for each type.
| Employment type | How overtime works | Key check |
|---|---|---|
| Full-time | Overtime applies once you work beyond the ordinary hours in your award, often the 38 weekly hours or a daily limit | Whether the award uses weekly, daily or roster-based limits |
| Part-time | Overtime usually applies for hours worked beyond your agreed hours or the award limits, depending on the award | Agreed hours and minimum engagement in the award |
| Casual | Base rate plus the 25% loading, with overtime calculated as the award says | Whether the loading is included in the base for overtime |
| Junior | A percentage of the adult rate for your age, applied to the overtime rate as the award says | Correct age bracket on the pay guide |
| Apprentice | Paid under the apprentice provisions, and overtime follows the award | Year of apprenticeship and training hours |
| Award-free | No award overtime rate, but the NES limits and the national minimum wage still apply | Contract terms and Fair Work Ombudsman advice |
Most private-sector employees are in the national system, but NSW state public sector staff and some local government workers are covered by the NSW state system, so check which applies to you.
How to calculate overtime step by step
Work from your pay guide, not from memory or a job ad. These six steps give a reliable result.
- Find your award, classification and employment type, then take the current hourly rate from the Fair Work Ombudsman pay guide.
- Add the 25% casual loading if you are a casual, unless your award treats loading differently for overtime.
- Work out your ordinary hours for the week, using the 38-hour limit or the limits set in your award or agreement.
- List every hour worked beyond those limits and mark whether it falls on a weekday, a night, a weekend or a public holiday.
- Look up the overtime or penalty rate for each category in the pay guide, and multiply the hourly rate by that rate for those hours.
- Add the ordinary pay and the overtime pay, then add any allowances the award lists and check the total against your payslip.
Worked example of the formula, using the national minimum wage from 1 July 2026:
- Ordinary pay for a full-time employee on $26.44 per hour for 38 hours is $1,004.90 for the week.
- Overtime pay is then [overtime hours] × $26.44 × [multiplier from your award], using your own pay guide for the multiplier.
- Award-free employees have no award overtime rate, so this example only shows the structure, not a rate that applies to you.
Employer obligations when paying overtime
Paying overtime correctly is about records as much as maths. Use this checklist for every pay run.
- Check the award or agreement for the overtime rate, the time limits and the span of hours before the payroll cut-off, especially before a long weekend.
- Record start times, finish times and breaks for every shift, because you must keep time and wage records for 7 years.
- Give each employee a payslip within 1 working day of payday that shows the hours and rates paid, including overtime and penalties.
- Report payroll information to the ATO through Single Touch Payroll on or before each payday.
- Pay super at 12% of ordinary time earnings for 2026-27, and make sure it reaches the fund within 7 business days of payday.
- Ask for overtime only if the request is reasonable, since an employee can refuse unreasonable additional hours. See meal and rest breaks for related rules.
Worker rights and what to do if overtime is underpaid
Overtime errors are common after the 1 July increase or a roster change. You can act without a lawyer.
- Compare your payslip with the Fair Work Ombudsman pay guide for your classification, employment type and the hours you worked.
- Write down the dates, start and finish times and amounts that look wrong, using your own roster, texts or timesheets.
- Raise it with your employer in writing and ask for a reply by a set date.
- If it is not fixed, contact the Fair Work Ombudsman on 13 13 94 for free help.
- Keep payslips and rosters, because employers must hold records for 7 years.
- Check related entitlements, such as penalty rates, public holiday pay rates and work allowances.
Common mistakes to avoid
- Using an old rate after the 4.75% award increase from 1 July 2026, which underpays overtime until the pay run is corrected.
- Applying the overtime multiplier to the wrong base rate, for example leaving out the casual loading when the award includes it.
- Paying a flat "all-in" rate without checking that it covers overtime, penalties and allowances for the hours actually worked.
- Ignoring daily limits and counting only the weekly 38 hours, when the award sets overtime from an earlier point.
- Assuming the same rule applies to every award, when the fast food award and other awards each have their own structure.
- Forgetting that overtime earnings may affect super calculations, so check with the ATO and read the super guarantee guide.
How to calculate overtime FAQ
How to calculate overtime?
Take the hourly rate from your pay guide, multiply it by the overtime rate your award sets, then multiply by the overtime hours. Add that to your ordinary pay and any allowances. The overtime rate depends on your award, so check the Fair Work Ombudsman pay guide for your classification.
How many hours before overtime starts?
For a full-time employee the NES sets 38 ordinary hours a week plus reasonable additional hours, but your award or agreement decides when overtime pay starts. Some awards also use daily limits or rostered hours. Check the overtime section of your pay guide for the exact trigger point.
Do casuals get overtime?
Yes, where the award provides for it. Casuals get the 25% loading in most awards, and award-free casuals on the national minimum wage get at least $33.05 per hour from 1 July 2026. Whether overtime applies to the loaded or base rate depends on the award.
Can an employer make me work overtime?
An employer can ask for reasonable additional hours, but you can refuse unreasonable ones. What is reasonable depends on your role, your circumstances and the notice given. If a dispute arises, speak to your employer first, then contact the Fair Work Ombudsman for advice.
This is general information, not legal, tax or financial advice, so check the Fair Work Ombudsman, the ATO or an employment lawyer for your situation. For the wider picture, read minimum wage in Australia, or visit our host employer labour hire page to talk to us.