Overtime Pay

Lesson 4.
Overtime Pay
Business Mathematics
Accountancy, Business, and Management
1
Can you recall instances
when members of your
household worked
overtime? Were they willing
to work the extra hours?
Why?
2
The Philippine Labor Code
states that employees'
regular work hours must
not exceed eight hours a
day.
3
Work beyond the regular
hours can be arranged
between the employer
and the employee;
however, the employee is
entitled to overtime pay.
4
Quick Look
How Much is Overtime?

Dominick is an employee who is paid ₱120 per hour or ₱960 per day. He is
required to work for 8 hours a day. He was requested to work on
December 23, 2021, even though it was his rest day. How much would he
earn for that day if he worked for 10 hours?
5
Quick Look

Solution:
Step 1: Identify what is required in the problem.
You are asked to compute the earnings of Dominick on

December 23,2021.
6
Quick Look

Solution:
Step 2: Identify the given in the problem.
Hourly rate: ₱120
Number of hours worked: 10 hours
Regular rate: 130%
Overtime rate: 130%
7
Quick Look

Solution:
Step 3: Write the working equation.
Earnings = regular pay + overtime pay
Regular Pay = (regular rate)(regular pay)
Overtime pay = (regular rate)(hourly rate)(no of hours

overtime)(OT rate)
8
Quick Look

Solution:
Step 4: Substitute the given values.
Overtime pay = (130%)(₱120)(2 hours)(130%)
Overtime pay = ₱405.60
Regular Pay = (130%)(₱960)
Regular Pay = ₱1,248

9
Quick Look

Solution:
Step 5: Find the answer.
Earning = ₱405.60 + ₱1,248
The total earnings of Dominick for that day are ₱1,653.60.
10
Quick Look
Questions to Ponder
1. Based on the computation, what is the overtime rate of pay on a regular
day?
2. How do you compute the total earnings of an employee who has done
overtime work ?
3. Why do you think it is necessary to give higher regular rate for overtime
pay?
11
Learning Competency
Compute overtime pay (ABM_BM11SW- IIe).
12
Learning Objectives
In this lesson, you should be able to do the following:

● Compare the different types of overtime and their
corresponding rate.
● Demonstrate the process of computing for the overtime pay.
● Develop a system for computing the overtime pay.
13
Overtime Pay
An 8-hour limit on work

is necessary for an
employee or worker to
have time for rest,
relaxation, and social
interactions.
14
Overtime Pay
However, there are times and

situations when members of
the business organization
need to work extra hours.
15
Overtime Pay
To compensate for the extra

time and effort provided by
the employee, over and
above the 8-hour limit,
employers provide them
with overtime pay.
16
● or overtime premium
● refers to the additional pay for
Overtime Pay work hours outside the regular
hours
17
Overtime Pay
To calculate the overtime pay, you may use the following

formula:
Overtime pay = RR x OH x HR x OR
where,
RR = regular rate
OH = overtime hours
HR = hourly rate
OR = overtime rate
18
Overtime Pay
To compute for the earnings for the day, the following formula
will be applied:
Earnings = Regular pay + Overtime pay
19
On a Regular Day
refers to the regular working

day agreed upon by the Regular Day
employer and the employee
20
On a Regular Day
Regular Rate Overtime Rate
100% 125%
21
Overtime Pay on a Regular Day
Closer L
o ok
Jerico is an employee working from Thursday to Monday, being paid

₱130 per hour or ₱1,040 per day. On a Saturday, he was required to
render 3 hours of overtime work.
22
Overtime Pay on a Regular Day
Closer L
o ok
Solution:
Overtime pay = (100%)(3 hours)(₱130)(125%)
Overtime pay = ₱487.50
Jerico earned ₱487.50 worth of overtime pay for that day.
23
Earnings for Overtime on a Regular Day
Closer L
o ok
If his regular work hours are 8 hours, how much would his total
earnings be for that day?
24
Earnings for Overtime on a Regular Day
Closer L
o ok
Solution:
Earnings = Regular pay + Overtime pay
Earnings = ₱1,040 + ₱487.50
Earnings = ₱1,527.50
Jerico’s total earnings for that day are ₱1,527.50.
25
Check Your Progress
An employee is paid ₱65 per hour of work and was

1 requested to render 2 hours of overtime work regularly.
How much overtime pay would they earn?
Answer area
26
On a Rest Day or Special Day
a day or days when a person

is not required to work, as
agreed upon by the Rest Day
employer and the employee
27
On a Rest Day or Special Day
● a Special Working Holiday

or a Special Non-working
Holiday
Special Day ● announced by the
national or local
government
28
On a Regular Day
130% 130%
29
Overtime Pay on a Rest Day or Special Day
Closer L
o ok
Connie is an employee working from Monday to Friday, being paid

₱145 per hour or ₱1,160 per day. On a Saturday, her rest day, she
was required to render 2 hours of overtime work. How much
overtime pay would he earn for that day?
30
Overtime Pay on a Rest Day or Special Day
Closer L
o ok
Solution:
Overtime Pay = (130%)(2 hours)(₱145)(130%)
Overtime Pay = ₱490.10
Connie earned ₱490.10 worth of overtime pay for that day.
31
Earnings for Overtime on a Rest Day or Special Holiday
Closer L
o ok
If her regular working hours are 8 hours for that day, how much
would her total earnings be?
32
Closer L
o ok
Solve for regular pay first:

Regular Pay = (regular rate)(daily rate)
Regular Pay = (130%)(₱1,160)
33
Closer L
o ok
Solve the total earnings:

Earnings = reg pay + OT pay
Earnings = ₱1,508 + ₱490.10
Earnings = 1,998.10
Connie’s total earnings for that day are ₱1,998.10.
34
Check Your Progress
A mason is paid ₱75 per hour of work. He rendered 2 hours
2
of overtime work after the regular hours on a rest day that is
also a special working holiday. How much overtime pay
would he earn?
Answer area
35
On a Rest Day on a Special Day
150% 130%
36
Overtime Pay on a Rest Day on a Special Day
Closer L
o ok
Jed is an employee working from Tuesday to Saturday, being paid

₱135 per hour or ₱1,080 per day. On November 1, 2021, his rest day
that falls on a special holiday, he was required to work and render
1.5 hours of overtime work.
37
Overtime Pay on a Rest Day on a Special Day
Closer L
o ok
Solution:
Overtime Pay = (150%)(1.5 hours)(₱135)(130%)
Jed earned ₱394.88 worth of overtime pay for that day.
38
Earnings for Overtime on a Rest Day on a Special Holiday
Closer L
o ok
Given the information, how much would his total earnings be?
39
Closer L
o ok
Solve the regular pay first
Regular Pay = (150%)(₱1,080)
40
Closer L
o ok
Earnings = ₱1,620+ ₱394.88
Jed’s total earnings for that day are ₱2,014.88.
41
On a Regular Holiday
● a fixed holiday, like New

Year's Day, Independence
Day, and Christmas Day Regular Holiday
● workers receive “double
pay”
42
On a Regular Holiday
200% 130%
43
Overtime Pay on a Regular Holiday
Closer L
o ok
John is an employee working from Wednesday to Sunday, being paid

₱100 per hour or ₱800 per day. On January 1, 2022, he was required
to work and render 4 hours of overtime work. How much overtime
pay would he earn for that day?
44
Overtime Pay on a Regular Holiday
Closer L
o ok
Solution:
Overtime Pay = (200%)(4 hours)(₱100)(130%)
Overtime Pay = ₱1,040
John earned ₱1,040 worth of overtime pay for that day.
45
Earnings for Overtime on a Regular Holiday
Closer L
o ok
46
Closer L
o ok
Solve the Regular Pay:

Regular Pay = (200%)(₱800)
47
Closer L
o ok

Earnings = ₱1 600+ ₱1 040
Earnings = ₱2 640
John’s total earnings for that day are ₱2,640.
48
Check Your Progress
A saleslady receives ₱60 per hour of work. She was required

3 to work for 8 hours, and she also rendered 3 overtime hours
on a regular holiday. How much would she earn?
Answer area
49
On a Rest Day on a Regular Holiday
260% 130%
50
Overtime Pay on a Rest Day on a Regular Holiday
Closer L
o ok
Aaron is an employee working from Monday to Friday, being paid

₱165 per hour or ₱1,320 per day. On December 25, 2021, he was
required to work and render 1 hour of overtime work. How much
overtime pay would he earn for that day?
51
Overtime Pay on a Rest Day on a Regular Holiday
Closer L
o ok
Solution:
Overtime Pay = (260%)(1 hour)(₱165)(130%)
Aaron earned ₱557.70 worth of overtime pay for that day.
52
Earnings for Overtime on a Rest Day on a Regular Holiday
Closer L
o ok
53
Closer L
o ok
Solve the regular pay:

Regular Pay = (260%)(₱1,320)
54
Closer L
o ok
Solve the total earnings.

Earnings = ₱3,432+ ₱557.70
Aaron’s total earnings for that day are ₱3,989.70.
55
Retail Customers Resolve an Overtime Pay Dispute.
Case Stu
dy
The Philippine Overseas Employment Administration or

POEA received a complaint from former employees of a huge
company based in the Middle East. Upon the end of the
contract, the said employees were then sent back to the
Philippines. They complained to POEA about the company not
paying their overtime pay.
Johann Legis, “How Rensol helped a Retail Customer resolve an Overtime Pay Dispute: A Case
Study,” Rensol Recruitment, https://rensol.com/overtime-pay-due-case-study/, last accessed
on December 12, 2021. 56
Case Stu
dy
The POEA then threatened the company’s accreditation

and reputation because of the said complaint. The said
company is apprehensive of the issue because it might affect
their existing contracts and future projects, and they might
face penalties sanctioned by the government.
Case Stu
dy
Along the process of investigation about the former

employees’ complaints, Rensol dug in, and the evidence
revealed that the employees rendered no overtime job and the
company has no monetary obligations to the employees.
Case Stu
dy
In some cases that an Overseas Filipino Worker is still under a

legally binding contract, the Department of Labor and
Employment (DOLE) or the Overseas Workers Welfare
Administration (OWWA) will be mediating between the
company and the employee. After the mediation, there will be
discussions regarding the complaint, finding a mutually
justifiable solution. Not all complaints need to be a legal battle.
Case Stu
dy
Even though the employees have arrived home for over two
months, an investigation was made about the complaint with
the intervention of the POEA and Rensol. This case is above the
agency’s jurisdiction, but Rensol Recruitment vowed to serve
beyond limitations.
Keep in Mind
● Overtime pay refers to the additional pay for work hours

outside the regular hours. The regular and overtime rates vary
according to the type of day:
61
Keep in Mind
62
Keep in Mind
● To calculate the overtime pay, you may use the following

formula:
● To compute for the earnings for the day, the following formula
will be applied:
63
Try This
Match the regular rates in Column B to the type of day in Column A.
Column A Column B
______ 1. Rest or Special Day A. 100%
______ 2. Regular Holiday B. 130%
______ 3. Rest on Special Day C. 150%
______ 4. Regular Day D. 200%
______ 5. Rest Day on Regular Holiday E. 260%

64
Practice Your Skills
Compute the earnings of the following employees.

1. Red is receiving ₱140 per hour of work, and he is required to work
for 8 hours every day. He worked for 9.5 hours on his rest day.
How much overtime pay would he earn that day?
Answer area
65
Practice Your Skills
Compute the earnings of the following employees.

2. Cyra is being paid ₱1,600 for every regular 8-hour day. If she did 2
hours of overtime work on a regular day, how much did she earn
for that day?
Answer area
66
Challenge Yourself
Answer the following questions:
1. Rolin is a full-time employee being paid ₱1,350 per day and

must work for 8 hours a day. On a special working holiday,
which happens to be his rest day, he was required to work
for 10 hours.
a. How much is his hourly rate?
b. How much would be his overtime pay?
c. How much would be his total earnings for that day?
67
Challenge Yourself
Answer area
68
Challenge Yourself
Answer the following questions:
2. In your coffee shop, there are two employees: A barista

and a cashier. Both of them are paid ₱75 per hour. The
barista worked overtime on his rest day for 4 hours. On the
other hand, the cashier worked overtime on a regular
holiday for 2 hours.
a. Who earned more overtime Pay?
b. What is the factor that caused the overtime pay
difference?
69
Challenge Yourself
Answer area
70
Photo Credits Bibliography
● Slide 1: jpqyfK7GB4w, by Towfiqu barbhuiya is Clendenen, Gary, and Stanley Salzman. Business
free to use under the Unsplash license via
Mathematics. Essex: Pearson Education
unsplash.com.
Limited, 2015.
Santos, Durwin and Sta. Maria, Karl Bryan. Business

Math. Makati City: Don Bosco Press, Inc., 2015.
Sterling, Mary Jane. Business Math for Dummies. NJ:

Wiley, 2008.
http://mis.kp.ac.rw/admin/admin_panel/kp_lms/fi
les/digital/SelectiveBooks/Mathematics/Business
%20Math%20For%20Dummies%20-%20%20Mar
y%20Jane%20Sterling.pdf
71

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Lesson 4.

How Much is Overtime?

How Much is Overtime?

Step 1: Identify what is required in the problem.

You are asked to compute the earnings of Dominick on

How Much is Overtime?

Step 2: Identify the given in the problem.

Hourly rate: ₱120

Number of hours worked: 10 hours

Regular rate: 130%

Overtime rate: 130%

How Much is Overtime?

Step 3: Write the working equation.

Earnings = regular pay + overtime pay

Regular Pay = (regular rate)(regular pay)

Overtime pay = (regular rate)(hourly rate)(no of hours

How Much is Overtime?

Step 4: Substitute the given values.

Overtime pay = (130%)(₱120)(2 hours)(130%)

Overtime pay = ₱405.60

Regular Pay = (130%)(₱960)

Regular Pay = ₱1,248

How Much is Overtime?

Step 5: Find the answer.

Earning = ₱405.60 + ₱1,248

The total earnings of Dominick for that day are ₱1,653.60.

Compute overtime pay (ABM_BM11SW- IIe).

In this lesson, you should be able to do the following:

An 8-hour limit on work

However, there are times and

To compensate for the extra

To calculate the overtime pay, you may use the following

Earnings = Regular pay + Overtime pay

refers to the regular working

Regular Rate Overtime Rate

Jerico is an employee working from Thursday to Monday, being paid

Jerico earned ₱487.50 worth of overtime pay for that day.

Jerico’s total earnings for that day are ₱1,527.50.

An employee is paid ₱65 per hour of work and was

a day or days when a person

● a Special Working Holiday

Regular Rate Overtime Rate

Connie is an employee working from Monday to Friday, being paid

Connie earned ₱490.10 worth of overtime pay for that day.

Solve for regular pay first:

Solve the total earnings:

Connie’s total earnings for that day are ₱1,998.10.

Regular Rate Overtime Rate

Jed is an employee working from Tuesday to Saturday, being paid

Overtime Pay = (150%)(1.5 hours)(₱135)(130%)

Overtime Pay = ₱394.88

Jed earned ₱394.88 worth of overtime pay for that day.

Solve the regular pay first

Regular Pay = (regular rate)(daily rate)

Regular Pay = (150%)(₱1,080)

Regular Pay = ₱1,620

Solve the total earnings:

Earnings = reg pay + OT pay

Earnings = ₱1,620+ ₱394.88

Jed’s total earnings for that day are ₱2,014.88.