Overtime Hours Calculation

How do I calculate overtime (OT) hours for retail staff?

A fashion retail staff works 5 days a week and off on Thu & Fri.

Week 1 – worked 5 days, 45 hours
Week 2 – worked 5 days, 45 hours
Week 3 – worked 4 days, 35 hours. Took 1 day of sick leave.
Week 4 – worked 5 days, 45 hours

week 3 is not entitled to OT since 35 + 8.8 (sick day) is less than 44.
so, is the total OT hours = 3 hours?



To calculate overtime hours for retail staff, you first need to determine the regular hours they work each week. In this case, the fashion retail staff works five days a week, which means their regular weekly hours are 40 hours (assuming an 8-hour workday).

For Week 1 and Week 2, the staff worked 45 hours each week, which means they worked 5 hours of overtime in each of those weeks.

For Week 3, the staff worked 35 hours and took 1 day of sick leave, which means they only worked 27.2 regular hours (35 regular hours – 7.8 sick leave hours). Since this is less than 40 regular hours, there is no overtime for Week 3.

For Week 4, the staff worked 45 hours, which means they worked 5 hours of overtime.

So, in total, the staff worked 15 hours of overtime over the four weeks.

Pitfalls of calculating overtime incorrectly

There are several pitfalls to calculating overtime incorrectly. Here are a few potential issues:

Non-Compliance with Labor Laws: If you miscalculate overtime pay, you may be in violation of labor laws. This could lead to legal action being taken against you or your employer.

Decreased Employee Morale: If employees feel like they’re not being paid correctly, they may become demotivated, leading to decreased productivity and morale.

Increased Costs: Incorrect overtime calculations may result in higher labor costs, as you may end up overpaying employees or underpaying them and then needing to make up the difference later.

Inaccurate Budgeting: If your overtime calculations are incorrect, you may not be able to accurately budget for labor costs, which can lead to financial difficulties for your organization.

Negative Reputation: If employees feel like they’re not being treated fairly, it could harm your organization’s reputation and make it more difficult to attract and retain top talent.

Overall, it’s important to ensure that overtime hours are calculated correctly to avoid these potential pitfalls. If you’re unsure about how to calculate overtime correctly, it’s best to consult with an expert or seek guidance from your HR department.

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