Overtime Pay Under the New Labour Code

Twice your ordinary hourly rate, triggered the moment you cross 8 hours in a day — here's the exact formula, not just the headline "double pay" rule.

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See how the 50% wage rule affects the wages your overtime rate is based on.

The short answer

Overtime pay is at least double your ordinary hourly rate, for every hour worked beyond the normal 8-hour working day set by the OSH Code, 2020 (48 hours/week, within a 12-hour spread-over).

The formula

hourly_rate = monthly_wages ÷ 26 ÷ 8
overtime_pay = hourly_rate × 2 × overtime_hours

"Wages" here means Basic + DA — the same definition used throughout the new labour codes — not your full CTC or gross salary. 26 represents standard working days in a month; 8 represents hours in a normal working day.

Worked example

A worker earning ₹30,000/month in wages, who works 5 hours of overtime in a pay period:

Hourly rate: ₹30,000 ÷ 26 ÷ 8 = ₹144.23
Overtime pay: ₹144.23 × 2 × 5 = ₹1,442.31

A second example, lower wages

A worker earning ₹20,000/month in wages, 8 hours of overtime:

Hourly rate: ₹20,000 ÷ 26 ÷ 8 = ₹96.15
Overtime pay: ₹96.15 × 2 × 8 = ₹1,538.46

Why your wages figure matters more than it seems

Because overtime is calculated on your wages (Basic + DA), the 50% wage rule can indirectly raise your overtime rate: if your wages were structured below 50% of your total remuneration, the new labour code tops them up for statutory purposes — and a higher wages figure means a higher hourly rate, which means more overtime pay for the exact same hours worked.

The hours cap that isn't fully settled yet

A quarterly limit of 125 overtime hours is widely cited for the OSH Code, but as of this article's verification, the final Central Rules operationalising the exact cap hadn't been fully notified. Treat this figure as indicative rather than a confirmed ceiling, and check for updates if you're relying on it for compliance decisions.

FAQ

At least double your ordinary hourly rate for every hour worked beyond the normal working day. Under the Occupational Safety, Health and Working Conditions (OSH) Code, 2020, a normal working day is capped at 8 hours (48 hours/week), within a 12-hour spread-over.

Monthly ordinary wages ÷ 26 (working days) ÷ 8 (hours/day) gives your hourly rate; overtime pay is that rate × 2 × overtime hours worked. "Ordinary wages" here means Basic + DA, the same "wages" definition used elsewhere in the new labour codes — it excludes HRA, bonus, and most other allowances.

A quarterly cap of 125 overtime hours is commonly cited for the OSH Code, but the final Central Rules operationalising this hadn't been fully notified as of this article's verification — treat this figure as indicative and re-check before relying on it for compliance purposes.

Indirectly — overtime is calculated on your ordinary wages (Basic + DA), and the 50% wage rule can raise that wages figure if it was previously structured below 50% of your total remuneration. A higher wages figure means a higher hourly rate, which means higher overtime pay for the same hours. See the 50% wage rule explained for the mechanics.

The OSH Code's overtime provisions are broader than the old Factories Act's factory-specific scope, but exact applicability can still depend on your establishment type and state rules. If you're a factory or industrial establishment worker, the rule applies squarely; for other salaried roles, confirm with your employer's HR team or a labour law professional.

Last verified: 14 Aug 2026

Sources: Occupational Safety, Health and Working Conditions Code, 2020 (normal working hours, overtime rate); Code on Wages, 2019 (wages definition).

This is indicative information. The final Central Rules on overtime hour limits were not fully notified as of this verification date. Confirm your exact entitlement with your employer's HR/payroll team or a qualified professional before relying on this for compliance or financial decisions.