Summary
Solution
The federal baseline for overtime is 1.5 x RRP (Regular Rate of Pay) for all hours over 40 in a week. Some states may offer additional overtime pay requirements like daily overtime and others, including the federal base.
- Weekly overtime: 1.5 x RRP
- Daily overtime: 1.5 x RRP
- Daily double overtime: 2.0 x RRP
- 7th consecutive day of any one workweek: 1.5 x RRP
If you need to run a report on overtime hours and pay, follow the steps in this article.
The Department of Labor states:
“For covered, nonexempt employees, the Fair Labor Standards Act (FLSA) requires overtime pay to be at least one and one-half times an employee's regular rate of pay after 40 hours of work in a workweek.
- Some exceptions apply under special circumstances to police and firefighters and to employees of hospitals and nursing homes. Additionally, workplaces that are governed by collective bargaining agreements may be exempt from the FLSA and will have separate overtime standards that they will need to follow.
Some states have their own overtime laws. In cases where an employee is subject to both the state and federal overtime laws, the employee is entitled to overtime according to the higher standard (i.e., the standard that will provide the higher overtime pay).
- Extra pay for working weekends or nights is a matter of agreement between the employer and the employee (or the employee's representative).”
Regular Rate of Pay (RRP) is a payroll concept under the Fair Labor Standards Act (FLSA) which is a federal law that protects workers by setting standards for their overtime pay and other wage-related protections.
Important: If you use Gusto Time Tracking, refer to the regulations for the state of your employees' assigned work location in Gusto.
This table was last revised June 2025.
State | Overtime occurs after... | Overtime calculation(RRP = regular rate of pay) | Explanation |
| Alabama |
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| Alaska |
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| Arizona |
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| Arkansas |
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| California |
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| Colorado |
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| Connecticut |
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| Delaware |
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| Florida |
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| Georgia |
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| Hawaii |
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| Idaho |
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| Illinois |
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| Indiana |
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| Iowa |
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| Kansas |
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| Kentucky |
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| Louisiana |
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| Maine |
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| Maryland |
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| Massachusetts |
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| Michigan |
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| Minnesota |
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| Mississippi |
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| Missouri |
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| Montana |
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| Nebraska |
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| Nevada |
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| New Hampshire |
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| New Jersey |
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| New Mexico |
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| New York |
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| North Carolina |
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| North Dakota |
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| Ohio |
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| Oklahoma |
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| Oregon |
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| Pennsylvania |
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| Rhode Island |
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| South Carolina |
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| South Dakota |
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| Tennessee |
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| Texas |
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| Utah |
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| Vermont |
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| Virginia |
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| Washington |
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| Washington DC |
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| West Virginia |
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| Wisconsin |
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| Wyoming |
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How your employee is classified determines if they're eligible for overtime pay. If you're not sure how your employees should be classified, the Department of Labor has some helpful guidelines.
More information about employee classifications can be found in these articles under the Changing employee classification type dropdown:
Use the dropdowns below to learn how to calculate overtime.
The rate used for overtime pay varies depending on your payroll schedule and how many pay rates you have. This overtime pay calculation applies to all hourly employees who have only one pay rate.
Calculating gross wages with overtime
Regular pay: First multiply your regular hours (overtime hours not included) worked by your regular pay rate to get your regular pay.
Overtime pay: Calculate the overtime rate by first multiplying your regular pay rate by 1.5 (for regular overtime) or 2 (for double overtime). Multiply this overtime rate by the amount of overtime hours to get the overtime pay.
Gross wages: Adding the overtime pay with your regular pay will give your total gross wages for the pay period.
Example
Your employee works 40 regular hours a week at $20 per hour. She decides to work an additional 10 hours in overtime. The following calculation will be used for gross wages:
- 40 regular hours x $20 regular pay rate = $800 regular pay
- 10 regular OT hours x ($20 regular pay rate x 1.5) = $300 OT pay
- $800 regular pay + $300 regular OT pay = $1,100 total gross wages
This overtime pay calculation applies to hourly employees who have multiple pay rates. If you're using Gusto Time Tracking, this is what multiple pay rates will look like when you run payroll.
Overtime will be calculated using a regular rate of pay based on the weighted average rate—learn more about this calculation here.
Calculate gross wages with overtime
Regular pay: First multiply each job rate by the number of job hours worked (overtime hours included), and then add these amounts together. This will give your regular pay amount.
Overtime pay: Calculate your additional overtime amount by first dividing your regular pay by the total hours worked in the pay period (overtime hours included). This will give you the weighted average rate. Multiply this weighted average rate by 50% (for regular overtime) or 100% (for double overtime), and then multiply this rate by the amount of overtime hours to get the additional overtime pay.
Gross wages: Adding the overtime pay with your regular pay will give your total gross wages for the pay period.
Example
Your employee works as a waiter 40 regular hours a week at $16 per hour. He also works as a bartender 1 hour a week at $11.80 per hour. He decides to work an additional 2.48 hours as a waiter in overtime. The following calculation will be used for gross wages:
- 40 regular waiter hours + 2.48 OT waiter hours x $16.00 waiter pay = $679.68 total waiter pay
- 1 bartender hour x $11.80 bartender pay rate = $11.80 bartender pay
- $11.80 bartender pay + $679.68 waiter pay = $691.48 regular pay
- $691.48 regular pay / 43.48 total hours worked = $15.90 weighted average rate.
- $15.90 weighted average x 50% x 2.48 OT hours = $19.72 OT pay
- $691.48 regular pay + $19.72 OT pay = $711.20 total gross wages
Note: Paystubs and payroll reports will show a different weighted overtime rate than the process flow in your account. However, the net pay is the same, it's just displayed a little differently. Here's a breakdown using the example above.
Weighted overtime rate calculation shown in the payroll flow
The payroll flow in your account would show the weighted overtime pay as $7.95.
- $691.48 total pay at regular rate of pay / 43.48 total hours worked = $15.90 weighted average rate.
- $15.90 weighted average x 50% = $7.95
Weighted overtime rate calculation shown on a paystub
An employee's paystub would show the weighted overtime rate as $23.95.
- 2.48 overtime hours at $16.00 regular rate for waiter hours = $39.68
- 2.48 overtime hours at $7.95 weighted overtime pay rate = $19.72
- $39.68 + $19.72 = $59.40 divided by 2.48 overtime hours = $23.95
Full-time employees
Standard full-time hours are determined as 8 hours per day x 40 hours per week x 52 weeks in a year = 2080
- Annual salary / annual hours (2080 standard full-time hours)
- Example: $45,000 salary / 2080 standard hours = $21.63 hourly rate
Part-Time Employees
Annual salary / total annual hours (# of hours worked x 52 weeks)
- Example: Employee works 25 hours per week
- 25 x 52 = 1,300 hours
- Annual salary: $45,000
- $45,000/1,300 = $34.61 hourly rate
Daily Overtime (OT) and Double Time (DT) calculations
More than 8 hours in a single workday
- OT in excess of 8 hours
- Total single-shift hours less than or equal to 12 hours – 8 = time paid at overtime rate
More than 12 hours in a single workday
This example is related to California's state overtime rules. Refer to the table for your state overtime rules.
- DT in excess of 12 hours
- Total single-shift hours more than 12 hours = time paid at double-time rate
Seven days in a row within a single pay period
- OT after working 8 hours on the 7th day
- Total hours over 40 worked in a workweek (excluding any time worked on the 7th consecutive day of work) = time paid at the overtime rate
- All hours up to 8 hours worked on the 7th day of the workweek = time paid at the overtime rate
Note: If your employee earns additional earnings, they may be included in overtime calculations.
If you pay time-and-a-half for holidays, you'll use the same instructions. If you pay holiday hours at the same rate as regular hours, either set up a holiday pay policy or put all the employee’s hours in the RH (Regular Hours) field.
It's the employer's discretion if you want to have paid time off taken by an employee count toward the calculation of the overtime—these hours are not actually "worked" and, therefore, not considered as hours counted toward overtime under the FLSA.
- Sign in to Gusto.
- Click the Pay section and select Run payroll.
- Click Run regular payroll.
- Click the Overtime field, or the total hours (TH) field if the hourly employee is using multiple pay rates. If you’re using the payroll spreadsheet, click the overtime cell.
- Enter the hours worked for holiday pay in the regular overtime fields. Be sure to log hours based on the week they were worked.
- Click Add Personal Note to indicate the holiday payment on the employee's paystub.
- Finish running payroll.