Labor Code Article 87
Overtime Pay Calculator
Work out overtime pay for an ordinary workday, a rest day, a special day, or a regular holiday, using the premium rates in the DOLE Handbook on Workers' Statutory Monetary Benefits.
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Your estimate
Overtime Pay
That is ₱301.73 for each overtime hour.
This amount is paid on top of your regular pay for the first 8 hours. A collective bargaining agreement or company policy may set higher rates.
Overtime pay guide
How overtime pay works in the Philippines
Under Article 83 of the Labor Code, normal working hours are capped at 8 hours a day. Any work beyond those 8 hours is overtime, and Article 87 says it must be paid with a premium on top of the hourly rate:
- On an ordinary workday: at least 25% more than the regular hourly rate (125%).
- On a rest day, special day, or holiday: at least 30% more than the hourly rate for that day. The rate for that day already includes a premium, so the two stack.
People often get the second rule wrong. Rest-day work is paid at 130% for the first 8 hours. Overtime on that rest day is 130% of that rate, so 1.30 × 1.30 = 169% of your basic hourly rate, not 130%.
DOLE overtime and premium rates
The multipliers below come from the DOLE Handbook on Workers' Statutory Monetary Benefits. The first column is what you earn for the first 8 hours on that type of day. The second column is the rate for each hour after that.
| Type of day | First 8 hours | Overtime, per hour | How it's computed |
|---|---|---|---|
| Ordinary workday | 100% | 125% | 1.00 × 1.25 |
| Rest day | 130% | 169% | 1.30 × 1.30 |
| Special non-working day | 130% | 169% | 1.30 × 1.30 |
| Special day falling on a rest day | 150% | 195% | 1.50 × 1.30 |
| Regular holiday | 200% | 260% | 2.00 × 1.30 |
| Regular holiday falling on a rest day | 260% | 338% | 2.60 × 1.30 |
| Double holiday (two regular holidays on one day) | 300% | 390% | 3.00 × 1.30 |
| Double holiday falling on a rest day | 390% | 507% | 3.90 × 1.30 |
For the first-8-hour rates and when holiday pay applies, see the holiday pay calculator.
Worked examples
Take an employee with a monthly basic salary of ₱42,000 on a Monday-to-Friday schedule. Their daily rate is ₱42,000 × 12 ÷ 261 = ₱1,931.03, and their basic hourly rate is ₱1,931.03 ÷ 8 = ₱241.38.
| Scenario | Computation | Overtime pay |
|---|---|---|
| 2 hours overtime on a Wednesday | ₱241.38 × 2 × 1.25 | ₱603.45 |
| 3 hours overtime on a Saturday rest day | ₱241.38 × 3 × 1.69 | ₱1,223.80 |
| 2 hours overtime on a regular holiday | ₱241.38 × 2 × 2.60 | ₱1,255.18 |
| 2 hours overtime on an ordinary day, from 10 PM to midnight | ₱241.38 × 2 × 1.25 × 1.10 | ₱663.80 |
In every case, this is paid in addition to the pay for the first 8 hours of that day. For the Saturday example, the employee also earns 8 × ₱241.38 × 1.30 = ₱2,510.35 for the regular rest-day hours.
Overtime at night
If overtime falls between 10:00 PM and 6:00 AM, Article 86 adds a night shift differential of at least 10% of the hourly rate for that time. For ordinary-day overtime, that makes 125% × 110% = 137.5% of the basic hourly rate. Tick the night-shift box in the calculator to apply it to any type of day.
Rules that affect whether you get overtime pay
- Undertime does not cancel overtime. Article 88 bars employers from offsetting undertime on one day with overtime on another.
- Overtime is usually authorized. Most companies require written approval before overtime. Article 89 lists emergencies where an employer can require it.
- Not everyone is covered. Article 82 excludes government employees, managerial employees and officers or members of the managerial staff, field personnel whose hours can't be determined with reasonable certainty, family members who depend on the employer, domestic workers, and workers paid by results.
- Compressed workweeks are different. Under an approved compressed workweek arrangement, hours beyond 8 on a scheduled day may not count as overtime, as long as the agreed weekly hours are not exceeded.
Why your payslip may show a different amount
If your figure doesn't match your payslip, the hourly rate is usually the reason. A company that divides monthly pay by 313 days (a six-day week) gets a lower hourly rate than one that uses 261 days (a five-day week). Other common causes:
- A collective bargaining agreement or company policy pays more than the legal minimum.
- Overtime minutes are rounded to the nearest 15 or 30 minutes.
- The day is classified differently than you assumed. For example, a holiday that falls on your rest day is paid at the higher combined rate.
Common questions
Overtime pay FAQs
What is the overtime rate on a rest day?
169% of your basic hourly rate. Rest-day work earns 130% for the first 8 hours, and overtime adds another 30% to that rate: 1.30 × 1.30 = 1.69.
What is the overtime rate on a regular holiday?
260% of your basic hourly rate. The first 8 hours on a regular holiday are paid at 200%, and overtime is 200% × 130% = 260%.
Is overtime pay taxable?
For most employees, yes. It is added to your taxable compensation for the month. Minimum wage earners are the exception: their overtime pay, holiday pay, and night differential are exempt from income tax.
Do managers get overtime pay?
Managerial employees and officers or members of the managerial staff are excluded from the Labor Code's hours-of-work rules, so overtime pay isn't required by law. Some employers still pay it by policy.
Can my employer offset my overtime with undertime?
No. Article 88 says undertime on one day cannot be offset by overtime on any other day, and permission to go on leave doesn't exempt the employer from paying overtime.