When overtime pay applies
Reviewed 16 October 2026. Overtime obligations depend on worker classification, establishment coverage, the appropriate government and current rules. The OSH Code, 2020 and the Code on Wages, 2019 provide protections, but the exact hours test and wage calculation must be checked against applicable Central or State rules and any sector-specific order.
The Labour Ministry's 2026 FAQ describes the standard as eight hours a day and 48 hours a week, with overtime paid at not less than twice the normal rate when the relevant threshold is crossed. It distinguishes daily-wage workers from others. Kerala employers should check current State rules and Labour Commissionerate directions before applying a daily or weekly test.
Calculate an estimate carefully
- Identify the covered worker category, establishment and appropriate government.
- Check whether the current rule tests hours by day, week, or both.
- Determine the statutory ordinary-rate wage base. Do not assume basic salary, gross pay, CTC, or monthly salary divided by 30 and 8 is the legal rate for every case.
- Apply at least twice the ordinary rate for each qualifying overtime hour and reconcile the calculation to attendance and payroll records.
Our Overtime Calculator is a planning aid based on the rate and hours entered. It does not determine worker classification, applicable rules or the statutory wage base. Verify those inputs before using its result for payroll.
Check current rules for consent, hour limits, rest intervals, weekly holidays, exemptions and registers. There is no single quarterly overtime cap that should be applied to every establishment.
Official references
Read the OSH Code, 2020, the Code on Wages, 2019, the Ministry's 2026 Labour Codes FAQs, and the Kerala Labour Commissionerate. GHR Consultancy supports Kerala employers with payroll and compliance; contact us.