You stayed late, worked through lunch, or came in on a Sunday. But when your payslip arrived, the extra hours weren't there — or the amount looked wrong. Understanding overtime pay is one of the most practical labor rights every Filipino employee should know.
What Is Overtime Pay?
Overtime pay is the additional compensation an employee receives for working beyond the normal 8-hour workday. Under Article 87 of the Labor Code of the Philippines, any work performed beyond eight hours in a single workday entitles the employee to overtime pay on top of their regular hourly rate.
Overtime Pay Rates
The overtime premium depends on when the extra hours are worked:
| Type of Day | Regular Hours | Overtime Rate |
|---|---|---|
| Ordinary Working Day | 100% of daily rate | +25% of hourly rate per hour |
| Rest Day / Special Non-Working Day | +30% of daily rate | +30% of rest day hourly rate per hour |
| Regular Holiday | 200% of daily rate | +30% of holiday hourly rate per hour |
| Regular Holiday falling on Rest Day | 260% of daily rate | +30% of that rate per hour |
How to Compute Overtime Pay
- Compute the hourly rate: Monthly Salary ÷ 22 working days ÷ 8 hours
- Overtime hourly rate = Hourly Rate × 1.25
- Overtime Pay = Overtime Hourly Rate × Number of Overtime Hours
Who Is Exempt from Overtime Pay?
Not all employees are entitled to overtime pay. The following are generally not covered:
- Managerial employees — those with power to hire, transfer, suspend, or dismiss employees and who exercise independent judgment
- Officers or members of the managerial staff who regularly direct the work of two or more employees
- Field personnel — workers whose hours in the field cannot be determined with reasonable certainty
- Members of the employer's family dependent on them for support
- Piece-rate workers paid on results rather than time
- Workers covered by a DOLE-approved Compressed Work Week (CWW) arrangement
Job title alone does not determine managerial status — the actual duties and authority exercised matter. Many employees labeled 'supervisor' or 'manager' may still be entitled to overtime.
Compressed Work Week (CWW)
A CWW arrangement allows employees to work more than 8 hours per day without incurring overtime pay, provided total weekly hours do not exceed 48 hours and the arrangement is voluntarily agreed upon and registered with DOLE. Under this setup, the regular daily rate already covers the extended hours up to the agreed limit.
Overtime Pay and Your Final Pay
- Review timekeeping records up to your last day of work
- Compute and include all unpaid overtime premiums in your last paycheck
- Release this within 30 days from the date of separation (DOLE Labor Advisory No. 06-20)
Quick Summary
- Work beyond 8 hours in a day entitles you to a 25% premium on ordinary days, more on holidays and rest days.
- The 8-hour limit applies per workday, not averaged across the week.
- Managerial employees, field personnel, and piece-rate workers are among those not entitled to overtime.
- Compressed Work Week arrangements may modify overtime rules but must be DOLE-registered.
- Unpaid overtime must be included in your final pay upon separation.
Calculate how much you're owed with our Final Pay Calculator — or read more about Holiday Pay rates, Night Differential and Separation Pay.