Overtime pay computation in the Philippines follows Article 87 of the Labor Code. Every hour worked beyond eight hours in a day earns the hourly rate plus at least 25% on an ordinary working day, and plus 30% of that day’s rate on a rest day, special non-working day or regular holiday.

Quick answer: Overtime pay = hourly rate × rate for the day × overtime premium × overtime hours. On an ordinary working day that is the hourly rate × 125%. An employee earning ₱800 a day (₱100 an hour) who works two hours of overtime earns ₱250 in overtime pay.

Last updated: October 29, 2026

Key Takeaways
  • Overtime is any work beyond eight hours a day, and it must be paid at a premium (Article 87, Labor Code).
  • Ordinary-day overtime is 125% of the hourly rate. On rest days and special days it is 169%, and on regular holidays 260%.
  • Undertime on one day cannot be offset against overtime on another day (Article 88).
  • Managerial employees, field personnel and a few other groups are not covered by overtime rules (Article 82).

Overtime Pay Calculator (Philippines)

Enter a monthly salary or daily rate, choose the type of day and add the overtime hours. The calculator applies the 2026 overtime, rest day, holiday and night differential rates.

Basic pay only, before deductions.
Daily rate = monthly salary × 12 ÷ paid days.
Enter 0 if the employee did not work that day.
Enter a salary or daily rate to see the pay for the day.
Estimate based on the Labor Code and DOLE’s Handbook on Workers’ Statutory Monetary Benefits. Overtime adds 25% of the hourly rate on ordinary days and 30% of the day’s rate on rest days, special days and holidays. Night differential is 10% of the hourly rate for that hour. Monthly-paid employees whose salary already covers holidays receive unworked holiday pay as part of their salary. Company policy or a CBA can give more. Not legal advice.
Want payroll, overtime and holiday premiums handled for you? Asiacruit’s Employer of Record services start at $199 per employee per month. Schedule a call with us

Overtime Rates in the Philippines (2026)

The overtime premium is applied to the rate for that day, so overtime on a rest day or holiday costs more than ordinary-day overtime. The last column uses a daily rate of ₱800 (₱100 an hour).

Type of dayOvertime rate per hourRate for the first 8 hoursOvertime per hour at ₱100/hour
Ordinary working day125%100%₱125.00
Rest day169%130%₱169.00
Special non-working day169%130%₱169.00
Special non-working day on a rest day195%150%₱195.00
Regular holiday260%200%₱260.00
Regular holiday on a rest day338%260%₱338.00
Double regular holiday390%300%₱390.00
Double regular holiday on a rest day507%390%₱507.00

A special working day, such as February 25 (EDSA People Power anniversary), is treated as an ordinary working day, so overtime is 125%. For the full holiday rules, see our guide to holiday pay in the Philippines.

How to Compute Overtime Pay: Step by Step

  1. Find the daily rate. For daily-paid employees, use the daily wage. For monthly-paid employees, divide the annual salary by the number of paid days in a year: monthly salary × 12 ÷ 261 (Monday to Friday), ÷ 313 (Monday to Saturday) or ÷ 365 (paid every day, including rest days and holidays).
  2. Find the hourly rate. Divide the daily rate by 8.
  3. Apply the rate for the day. 100% on an ordinary day, 130% on a rest day or special day, 200% on a regular holiday, and so on (see the table above).
  4. Add the overtime premium. Multiply by 1.25 on an ordinary day, or by 1.30 on a rest day, special day or holiday.
  5. Multiply by the overtime hours.

Example 1: Monthly-paid employee, ordinary working days

Ana earns ₱30,000 a month and works Monday to Friday. She worked 10 hours of overtime on ordinary days this month.

  • Daily rate: ₱30,000 × 12 ÷ 261 = ₱1,379.31
  • Hourly rate: ₱1,379.31 ÷ 8 = ₱172.41
  • Overtime rate: ₱172.41 × 125% = ₱215.52 an hour
  • Overtime pay: ₱215.52 × 10 hours = ₱2,155.17

Example 2: Overtime on a regular holiday

Ben earns ₱800 a day and works 10 hours on Christmas Day, a regular holiday.

  • First 8 hours: ₱800 × 200% = ₱1,600
  • Overtime: ₱100 × 200% × 130% × 2 hours = ₱520
  • Total for the day: ₱2,120

Example 3: Overtime at night

Carla earns ₱800 a day. On an ordinary day she works two hours of overtime from 10 PM to midnight, so night differential also applies.

  • Overtime: ₱100 × 125% × 2 hours = ₱250
  • Night differential on overtime: ₱125 × 10% × 2 hours = ₱25
  • Total extra pay: ₱275

For more on the 10 PM to 6 AM premium, see our night differential guide and calculator.

125%
Minimum overtime rate on an ordinary working day under Article 87 of the Labor Code

Who Is Entitled to Overtime Pay?

Overtime rules cover employees of private businesses, whether or not the business is run for profit. Article 82 of the Labor Code excludes these groups:

  • Managerial employees, and officers or members of the managerial staff
  • Field personnel whose actual hours of work cannot be determined with reasonable certainty
  • Members of the employer’s family who depend on the employer for support
  • Domestic workers, who are covered by the Batas Kasambahay (RA 10361) instead
  • Workers paid by results, as defined in DOLE regulations
  • Government employees, who follow Civil Service rules

A job title does not make someone managerial. What counts is the actual work: whether the employee manages the business or a department, directs other employees and can hire, fire or recommend those decisions.

Overtime Rules Employers Often Get Wrong

  • Offsetting undertime. Undertime on one day cannot be offset against overtime on another day (Article 88). Giving time off later does not replace overtime pay.
  • “Salary includes overtime.” A salary that already includes overtime is only valid if the employee clearly agreed and the amount covers at least the legal overtime rate for the hours worked.
  • Unapproved overtime. Employers can require overtime to be approved in advance, but overtime worked with the employer’s knowledge or permission must still be paid.
  • Compulsory overtime. Employers can only require overtime in the situations listed in Article 89, such as emergencies, urgent work to prevent loss of life or property, or work that cannot be interrupted without serious loss.
  • Compressed workweeks. Under a valid compressed workweek arrangement, hours beyond eight that are part of the agreed schedule are not overtime. Only hours beyond the compressed schedule are.
  • Time records. Employees can file money claims for unpaid overtime within three years (Article 306, formerly 291), so keep accurate time records.

Is Overtime Pay Taxable?

Yes, for regular employees. Overtime pay is part of taxable compensation and goes into the BIR withholding tax computation. Statutory minimum wage earners are exempt from income tax on their minimum wage, overtime pay, holiday pay, night differential and hazard pay.

Overtime pay is also not part of the base for 13th-month pay, which uses basic salary only. See our 13th-month pay computation guide.

Need overtime computed correctly every payroll?

Asiacruit runs Philippine payroll with overtime, night differential and holiday premiums applied automatically. Employer of Record services start at $199 per employee per month.

Schedule a call with us

Official sources: Department of Labor and Employment (DOLE), Labor Code of the Philippines, Articles 82 to 90, and DOLE’s Handbook on Workers’ Statutory Monetary Benefits. Check the latest DOLE advisories before running payroll.

Frequently Asked Questions

How do you compute overtime pay in the Philippines?

Multiply the hourly rate by 125% and by the number of overtime hours on an ordinary working day. For example, ₱100 an hour × 1.25 × 2 hours = ₱250. On rest days, special days and holidays, the overtime premium is 30% of the rate for that day.

What is the overtime rate on a rest day?

Overtime on a rest day is 169% of the hourly rate. The rest day rate is 130%, and overtime adds 30% of that rate (130% × 130%).

How much is overtime pay on a regular holiday?

Overtime on a regular holiday is 260% of the hourly rate (200% × 130%). If the regular holiday also falls on the employee’s rest day, overtime is 338% of the hourly rate.

Does an employer have to pay overtime that was not approved?

Employers can require overtime to be authorized in advance. However, overtime that the employee worked with the employer’s knowledge or permission must still be paid. A written approval process and accurate time records protect both sides.

Are managers entitled to overtime pay?

No. Managerial employees and officers or members of the managerial staff are excluded under Article 82 of the Labor Code, as are field personnel whose hours cannot be determined. A job title alone does not make someone managerial; the actual duties decide it.

Is overtime pay included in 13th-month pay?

No. 13th-month pay is based on basic salary, which excludes overtime, night differential and holiday premiums, unless a contract or company practice treats them as part of basic pay.

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