How to compute the Overtime Pay

HOW TO COMPUTE THE OVERTIME PAY by: Kyla Camille E. Chumacera

An employee who worked on;

(A) ordinary day, – For work done on an ordinary day, overtime pay is computed as the employee’s regular hourly rate plus an additional 125% of the regular hourly rate. For example, if an employee’s regular hourly rate is PHP 100 per hour and they work 2 hours of overtime, their overtime pay would be (120/60) * 100 *1.25 = Php 250

(B) Special Non-Working Day fall in weekdays, – A special non-working day usually follows a ‘No Work, No Pay’ principle. Therefore, the employee is not entitled to any compensation if they did not work that day. However, when an employee works on a Special Non-Working Day that falls on a weekday, they are entitled to additional compensation, which is the sum of 130% of their daily rate for the first 8 hours of work and an additional 169% of their hourly rate for every hour of work in excess of 8 hours. For example, if an employee’s daily rate is PHP 800 and they work 10 hours on a Special Non-Working Day, their overtime pay would be (800*1.3)+(120/60)*100*1.69 = Php 1040 + Php 338 = Php 1,378.

(C) Regular or legal holiday fall in weekdays – Employees who work on regular or legal holidays falling on weekdays are entitled to additional compensation, which is the sum of 200% of their daily rate for the first 8 hours of work and an additional 260% of their hourly rate for every hour of work in excess of 8 hours. For instance, if an employee’s daily rate is PHP 1000 and they work 10 hours on a regular holiday, their overtime pay would be (PHP 1000 * 2) + ((PHP 120 / 60) * 125 * 2.6) = PHP 2650

(D) Special Non-Working Day fall in Saturday but not rest day – When a Special Non-Working Day falls on a Saturday but is not considered a rest day, the computation of overtime pay follows the same principles as that of a special no-working day that falls in weekdays.

(E) Regular or legal holiday fall in Saturday but not rest day – This is also the same with the principle of a regular or legal holiday that falls in weekdays. Given the scenario if an employee’s daily rate is PHP 1000 and they work 10 hours on a regular holiday, their overtime pay would be (PHP 1000 * 2) + ((PHP 120 / 60) * 125 * 2.6) = PHP 2650

(F) Special Non-Working Day fall in Sunday but not rest day – When a Special Non-Working Day falls on a Sunday but is not a rest day, the computation of overtime pay follows the same principles as scenarios in B and D.

(G) Regular or legal holiday fall in Sunday but not rest day – The computation of overtime pay follows the same principles as that of a regular or legal holiday falling on a weekday, as outlined in scenario E.

(H) Special Non-Working Day fall in Sunday and rest day at the same time – When an employee works on a Special Non-Working Day that falls in Sunday and rest day at the same time, they are entitled to additional compensation, which is the sum of 150% of their daily rate for the first 8 hours of work and an additional 195% of their hourly rate for every hour of work in excess of 8 hours. For example, if an employee’s daily rate is PHP 800 and they work 10 hours on a Special Non-Working Day, their overtime pay would be (800*1.5)+(120/60)*100*1.95 = Php 1200 + Php 390 = Php 1,590.

(I) Regular or legal holiday fall in Sunday and rest day at the same time – Employees who work on regular or legal holidays falling in Sunday and rest day at the same time, are entitled to additional compensation, which is the sum of 260% of their daily rate for the first 8 hours of work and an additional 338% of their hourly rate for every hour of work in excess of 8 hours. For instance, if an employee’s daily rate is PHP 1000 and they work 10 hours on a regular holiday, their overtime pay would be (PHP 1000 * 2.6) + ((PHP 120 / 60) * 125 * 3.38) = PHP 3,445