Overtime pay calculator
At £15 an hour, 6 hours of time and a half on top of a 37.5-hour week pays £697.50 — £135.00 of it overtime. But across all 43.5 hours the week averages £16.03 an hour, a rise of just 6.9% from a rate that sounded like 50% more.
How this is worked out
Basic pay is the hourly rate multiplied by the normal hours. Overtime pay is the same rate multiplied by the extra hours and then by whatever multiplier your contract gives — 1.5 for time and a half, 2 for double time, or 1 where extra hours are simply paid flat, which is lawful and common. The two added together are the week's gross pay. The effective hourly rate is that total divided by every hour worked, basic and overtime alike, which is what turns a headline multiplier into the figure your week genuinely averaged.
£15 an hour, a 37.5-hour week, plus 6 hours at time and a half
- Basic pay is £15 × 37.5 = £562.50.
- Overtime is £15 × 6 × 1.5 = £135.00, so the week comes to £697.50.
- That is 43.5 hours in total.
- £697.50 ÷ 43.5 = £16.03 an hour across the week — a rise of under 7%, from a rate that sounded like 50% more.
The effective rate is the whole week divided by every hour in it, basic and enhanced together. It is not a presentational choice: it is the measure the National Minimum Wage is tested against, so it is the figure that matters if the hours are long and the basic rate is modest.
Why there is nothing to cite here
Your basic rate and your overtime multiplier both come from your contract, not from legislation — GOV.UK is explicit that employers do not have to pay for overtime at all. So there is no published rate behind this page and nothing to go stale. The two places the law does bite — the minimum wage floor on your average pay, and how the pay is taxed — are linked rather than reproduced, because those figures do change and belong on pages that carry a date.
What catches people out
- There is no legal right to be paid extra for overtime in the UK. GOV.UK puts it plainly: employers do not have to pay workers for overtime. Time and a half is a contractual arrangement, not a statutory one, and plain time — or nothing at all for salaried staff — is lawful. Whatever multiplier your contract states is the one to enter here.
- What the law does require is that your average pay across all the hours you work stays at or above the National Minimum Wage. That makes the effective hourly figure below the one that actually matters: it is the number to compare against the minimum wage, not your basic rate, because unpaid or lightly paid extra hours drag the average down.
- Overtime is not taxed at a special rate. It is taxed at your marginal rate like any other pay — the reason a big overtime month feels over-taxed is that PAYE spreads your allowances evenly across the year, so a spike in one period is temporarily taxed as though every period would be that large. It corrects itself over the following months rather than being lost.
- A large multiplier on a small number of hours moves your average pay much less than it feels like it should. Time and a half sounds like a 50% uplift; six such hours on top of a 37.5-hour week raise the week's average by under 7%. The headline rate is not the rate you are being paid.
- Salaried staff working unpaid overtime are quietly taking a pay cut in hourly terms. The salary does not move, so every extra hour lowers the real rate — which is the figure worth having before comparing a salaried job with an hourly one.
Questions
Is overtime taxed more than normal pay?
No. There is no separate overtime tax rate — it is taxed at your marginal rate exactly like the rest of your pay.
The reason it often looks otherwise is how PAYE works. Your tax-free allowance is spread evenly across the year, so a month with a lot of overtime is briefly treated as though every month would be that big, and too much tax comes off. Later months correct it. The take-home pay calculator shows what the year actually costs.
Does my employer have to pay me extra for overtime?
No. GOV.UK is explicit that employers do not have to pay for overtime at all. Any enhanced rate comes from your contract.
The one hard limit is the National Minimum Wage: your average pay across every hour worked must not fall below it. If long unpaid hours pull that average under the minimum, that is unlawful regardless of what the contract says.
What does "time and a half" mean?
One and a half times your basic hourly rate for each overtime hour. At £15 an hour, an overtime hour pays £22.50.
Double time is twice the basic rate. Both are contractual terms, so check what yours actually says — some contracts pay an enhanced rate only after a threshold, or only at weekends.
Why is my effective hourly rate lower than the overtime rate?
Because most of your hours are still paid at the basic rate. The effective figure averages the whole week — basic hours and enhanced hours together — which is the honest measure of what an hour of your time earned.
It is also the figure the minimum wage is tested against, so it is worth knowing even when the overtime rate looks generous.
Does overtime count towards my pension?
It depends entirely on the scheme. Some define pensionable pay as basic salary only, others include overtime and shift premiums. The scheme rules decide it, not the law, and the two are commonly different.
Check the definition of pensionable pay in your scheme documents — it is the sort of detail that changes a contribution noticeably over a career.
What a year of this leaves you
Work out the next thing
- Statutory redundancy payWorked out year by year, because the rate depends on the age you were during each year of service rather than your age when the job ends.
- Take-home payGross salary in, every deduction itemised out — income tax band by band, National Insurance, student loan, pension.
- Pay riseWhat a rise or a bonus is actually worth in your bank account, and the marginal rate that decides it.