HRSINGAPORE Community Discussions
Overtime Calculation Formula
Dear HR Professionals,
I understand that for overtime calculation for the monthly rated employee, it is (12 x Monthly basic rare of pay)/ 52*44. If my company working hour is 8.40 am to 6 pm (less than 44 hours), what should the formula be?
Thank you all in advance
The formula is:
(12 x monthly basic salary) / (52 weeks x working hours in a week)
The legal formula is 44 hours per week. If the company is generous in using lesser weekly hours in the OT formula (eg 43 hours), this will give the employee a higher OT rate, which MOM will not object but gladly welcome.
Our employees work less than 44 hours a week but the OT rate is computed based on 44 hours a week.
Stick to the formula in the Act because the OT rate applies only after 44 hours. If your company working hours per week is, say 42 hours, and you decide to pay OT based on 42 hours, you actually end up paying “extra” for the 2 regular hours, in addition to the hours beyond 42.
As per MOM, it is still based on 44 for OT.