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Factories Act Overtime Pay Calculator for Indian Factories

Overtime is one of the most disputed lines in a factory payroll. This calculator turns monthly basic plus dearness allowance into an hourly rate, applies the overtime multiplier, and shows the cost per worker and for a whole crew so you can plan shifts with real numbers.

Your numbers

Rs

Ordinary rate of wages: basic, dearness allowance and cash value of concessions, excluding bonus and overtime

days

Commonly 26, or the actual days in the month under some policies

hours
20 hours
workers

Your results

Overtime pay per worker
Rs 3,462
Overtime cost for the crew
Rs 138,462
Ordinary hourly rate
Rs 87
Overtime hourly rate
Rs 173
Overtime as share of monthly wage
19.2%

The Factories Act pays overtime at twice the ordinary rate of wages, but state rules, wage definitions, the labour codes and your settlements can differ. Overtime hour limits also apply. Confirm with your labour consultant before paying.

Save results:

Overtime pay per worker against overtime hours

Sweeps Overtime hours per worker from 0 to 60, holding your other inputs fixed.

Forecast overtime from your production plan

Optional: discuss pulling shift and attendance data into an overtime forecast.

Optional. The tool and every export work without this. No spam.

The formula

Ordinary hourly rate equals monthly basic plus DA divided by wage days and normal hours per day. Overtime rate equals the hourly rate times the multiplier. The Factories Act provides that a worker who works beyond the normal limits is entitled to wages at twice the ordinary rate of wages, and the ordinary rate includes basic, allowances such as dearness allowance and the cash value of concessions, but excludes bonus and overtime. Overtime pay equals overtime rate times overtime hours.

  • Hourly rate = basic plus DA divided by (days times hours)
  • Overtime rate = hourly rate times multiplier
  • Pay = overtime rate times hours
  • Crew cost = pay times workers

Worked example

With basic plus DA of Rs 18,000, a 26 day divisor and 8 hour day, the ordinary hourly rate is about Rs 86.54. At the double rate that is about Rs 173.08 per overtime hour. Twenty hours gives roughly Rs 3,462 per worker, and for 40 workers about Rs 1.38 lakh. The chart shows how the cost scales linearly with hours, which helps when deciding between overtime and adding a shift or temporary hires.

Using it well

Compare the overtime cost with the cost of an extra shift or contract workers before approving routine overtime. Watch statutory limits on weekly and quarterly overtime hours, which vary by state rules, and keep records of who worked and when. Some companies pay a lower multiplier by policy or settlement, but they must not fall below what law requires for covered workers, so check coverage first.

Frequently Asked Questions

What is the ordinary rate of wages?

Broadly it is basic wages plus allowances such as dearness allowance and the cash equivalent of concessions, excluding bonus and overtime. Confirm the exact definition for your state and establishment.

Is the divisor 26 or the actual month days?

Practice varies. Many employers use 26 working days, while others use calendar days in the month. Use the basis in your appointment terms, settlement or state rules, and apply it consistently.

Does the double rate apply to everyone?

It applies to workers covered by the Factories Act provisions on overtime. Managerial staff are often outside coverage. Check coverage, and confirm how the new labour codes apply to your unit.

Can I use it for budgeting?

Yes. Set crew size and expected hours to estimate monthly cost, then compare the result with options such as another shift. Use actual payroll for final payment.

If attendance and shift data live in your ERP or MES, we can help forecast overtime cost from the production plan. The calculator works with typed inputs alone.