Labour Laws & Ir
Suresh Ramalingam
Legal, Hr & Compliance
Hr ( Generalist)
Hr Professional
Gm (hr)
Asstt. Manager-hr
Nishant Vishwakarma
Hr Professional
Hr Professional
Mahesh O M
Hr Payroll Executive
+3 Others

Dear All, Could you all help in calculating overtime payment for staff especially in the lower cadres. Do we deduct PF, ESI and Ptax from overtime payment? Please explain. Regards, Preenitha
14th August 2007 From India, Hyderabad
Overtime Caculation Gross Salary = 3510 Overtime Hrs = 75 Calculation = 3510/30/8*75*2 Gross Salary/Month/Day Hrs.*OT Hrs*2 If pay double
15th August 2007 From India, Delhi
on the same matter in different form, i have posted a mail on 02 august 2007 and even till today no suitable reply is being obtained and suggestions which you have received also is contradictory.
as a practitioner, for the permanent employee we divide the monthly basic by 30 and on the basis of the same we enumerate the wage and for contractor employee and governed by minimum wage, we divide it by 26.
hope this will suffice to your requirement.
with thanks,
asitabha sanyal
16th August 2007 From India, Delhi
one more thing i want to add that overtime wages is subjected to the deduction of esi and not the pf. i have no idea about the ptax. with thanks, asitabha sanyal
16th August 2007 From India, Delhi
Overtime is separate for the company's employee and contractor employee's
Company employee's overtime calculation:
((Basic+Da)/No. of day's of the particular month/8)*No. of hrs overtime*2 =OT rate.
Contractor employee's overtime calculation"

((Basic+DA)/26/8) * No. of hrs overtime * 2 = Overtime Rate
25th June 2008 From India, Ghaziabad
Hi Preenitha,
Overtime for the staff especially in the lower cadres calculation:
((Basic +DA)/No. of days by which the salary is prepared/Working hrs of the working day. i.e 8 hrs)* No. of hrs Overtime done*2 = Overtime amount to be paid.
Overtime attracts ESI. But on overtime PF is not applicable.
Regarding the Ptax I am not aware.

12th July 2008 From India, Ghaziabad
Hi everybody there,
Overtime calculation:
For the regular employee of the company:
((Basic+Da)/No. of days of the particular month/No. of working hours of shift)*2*No. of Hrs of OT done=
Overtime amount for that employee. e.i ((2500+461)/31/8)*2*16 hrs=Rs. 395/-
For the contractor employee:
((Basic+Da)/26 days that is standard/No. of working hours of shift)*2*No. of Hrs of OT done=
Overtime amount for that employee. e.i ((2500)/26/8)*2*16 hrs=Rs. 385/-
Please note Overtime attracts ESI only, not PF but regarding PTax I am not aware.
I think I have made myself clear to your doubt.
6th August 2008 From India, Ghaziabad
Mr. PBS Kumar, Why PF will attract the over time payment ? Give the reason, pls Purshottam Saini
7th August 2008 From India, Calcutta
sir Plz give me advice for calculaion of ot .Can we calculate ot for monthly or weekly with same Farmula like division by 26 . what is correct as per the Law. Nishant
11th August 2008 From India, Ranchi
There is lot of queries on OT to be considered for statutory deductions, i have given the reasons below.
ESI - OT has been included as wages by the provision of the Act.
PF - OT is not included as wages by the provisions of the Act.
PT - If the Gross wages cross the prescribed ceiling then PT has to be deducted. (Specific to State laws)
Suresh Ramalingam
13th August 2008 From India, Mumbai
you can calculate overtime like this total salary / 30 / 8 / no of ot hrs X 2.
Basically as per rule we hv to pay ot at double rate and divided by 26. but normally most of the factories pay at single rate. So u can also pay by single rate and divided by 30.
Harjeet Singh
14th August 2008 From India, Delhi
Dear Friends,Please see the attachment for over time.
14th August 2008 From India, Kakinada

Attached Files
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File Type: doc THE TIME MANAGEMENT IN FACTORIES ACT.doc (32.0 KB, 1049 views)

Dear Mr. PBS Kumar PF is totaly based on Basic + DA that to consider as per the minimum wages Act accoding to the state rules, how can OT be considered for PF? Ramnath
7th March 2009 From India, Bangalore
:?: going through all these discusion and postings there is not of confusion on consideration of no of days. (30 or 26) As i feel it is statutory rule which priscribe 26 working days only.
Plz clearify me if i m wrong with priscribed rule or Act.
7th March 2009 From India, Bangalore
I have also gone through all posts on calculation of overtime but most of my friends
has given reply as what they are doing in their establisments.We are here to give reply legally , not on what we are following in our establishment.Even one of our friend has given different calculation for company employees ,as well as contractor employees, as law for calculation of OT is different for both.
dear total salary is to be divded by 26 in both cases as mr ramnath said because one day wages we get by dividing from 26 not by dividing from 30/31.
OT WILL not attract contribution towards PF.
7th March 2009 From India, Delhi
Hi All, I would like to know who are eligible for OT? Are all employees eligible or only operational staff? Our organisation is governed by the Bombay Shops and Establishments Act. Regards,
7th March 2009 From India, Mumbai
Dear Sir, Please go through the definition of the employee under the Bombay Shop Act. Regards, R.N.Khola Skylark associates,Gurgaon
13th March 2009 From India, Delhi
Thank you Mr Malik,
Bcoz going through all this discussion i also got confused... but plz share your views reg the ordinary wage as per the govt act? as i felt it is gross montly wages...which include (Basic+Da+HRA+conv+travl Allow+Med Rem+others if any)
24th October 2009 From India, Bangalore
Different ideas and different formulaes - can anyone give an exact calculation as per the Minimum Wage Act 1948 or as per the Over Time Act as in the Shops and Establishment Act. I would be very happy!!!
28th October 2009 From India, Madras
Dear Yelhsa,
Mr. Malik had briefed according to the law & even we follow the same..but some orgns follows diff policy. but ultimately we have to follow as per the law.
Plz go through the postings & discussion...
29th October 2009 From India, Bangalore
Dear all as i just see the discussion related to Overtime calculation can any one tell me is this calculation is mention in which act
15th October 2010 From India, Haldwani
I want to add that OT wages are subjected to the deduction of P.Tax and ESI and not PF. regards. T M Rao
16th October 2010 From India, Hyderabad
Dear Member,
OT amount calculation is made in accordance with the applicability of the Act. First we are to decide which of the Act is applicable to your establishment for grant OT payment such as State Shops & Establishment Act, Minimum Wages Act, Factories Act, 1948 etc. Therefore go through the applicability provisions under different Acts & see which is applicable in your case & then see OT payment provisions in that Act.

16th October 2010 From India, Delhi
Can you please clarify we are multiplying *2 ?
30th November 2017 From India, Mumbai
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