Sub-Sec (1) Sec. 59 of Factories Act 1948 provides :- where a worker works in a factory for more than 9 hours in any day or for more than 48 hours in any week, he shall, in respect of overtime work , be entitled to wages at the rate of twice his ordinary rate of wages.
Sub-sec.(2) of Sec.59 provides that "ordinary rate of wages" means the basic wages plus such allowancs, including the cash equivalent of the advantages through the concessional sale to workers of foodgrains and other articles as the worker is for the time being entitled to, but does not include a bonus and wages for overtime work.
to calclaculate OT
Basi+DA /30 =one day wages divded by 8 = 1 hour wages multiplied by 2 you gat twice the rate of OT .
RLDhingra , Advocate & Labour Law Consultant , 09818309937
Under the Minimum Wages act the wages are considered for 26 days and this is being followed under the Gratuity act also. in in pay roll computations also we divide the wages by 26 to arrive at loss of pay.
On the same basis, I was under the impression that for OT the Basic + DA has to be divided by 26 instead of 30. Kindly correct me if I am wrong.
We divide the wages by 26 because the it include the weekly off days
but when you calculate OT divide the monthly wages by 30 and then by 8 to get hourly wages and multiply by 2 because the workman has to be paid at twice the rate. In case of employment in agriculture it be multiplied by 1.5 times .
RLDhingra , Advocate and Labour Law Consultant , 09818309937
Our company is already paying basic less than minimum wage as per decided in our zone, but while looking the gross, it shows more than minimum wage.
Due to keeping less basic than minimum wage, we are calculating OT on gross that too Single and NOT double..........is that fine ?
Waiting for your reply
Thanks & Regards
OT will be calculated on Basic + DA + any other fixed allownaces like House Rent allownace (which is paid monthly & on a regular basis).
Any fixed allowance , paid on monthly basis, please check with law of the land before OT exemption .