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Overtime Calculations

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Basic Overtime Calculations 

1. Click Edit to go to edit mode.

2. Enter OT hours for the appropriate rate.

3. Finally click “Calc Payslip”. This will give the final payslip amount.

Notes : 

  1. The Daily rate and hourly rate are based on Basic / 26.
  2. The default for all staff can be edited in the default screen.
  3. Individual daily and hourly rates can changed in the personal info screen as follows.

hourlyrate

 

Hourly Rated

This is a special option for daily and hourly rated workers. Entering any value here will calculate the basic pay based on the number of hours worked. The basic pay will be replaced by “hourly rate” x “no. of hours”.

Hourly rate will be based on Basic salary or hourly rate specified in Personal Info Screen. 

 

OT Rate

  • OT Rate is based on (Basic Salary + Allowance) / Work days. 
  • Not all allowance are included. Traveling allowance is not added but Attendance Allowance is added. 
  • Work days is normally 26 days. Can use a number less than 26, but not more than 26.

In general, payments such as Shift Allowance, Call Back Allowance, Attendance Allowance, Acting Allowance are subject to Wages and they must be considered into overtime calculation.

EMPLOYMENT ACT 1955, SECTION 2:

“wages” means basic wages and all other payments in cash payable to an employee for work done in respect of his contract of service but does not include—

(a) the value of any house accommodation or the supply of any food, fuel, light or water or medical attendance, or of any approved amenity or approved service;

(b) any contribution paid by the employer on his own account to any pension fund, provident fund, superannuation scheme, retrenchment, termination, lay-off or retirement scheme, thrift scheme or any other fund or scheme established for the benefit or welfare of the employee;

(c) any travelling allowance or the value of any traveling concession;

(d) any sum payable to the employee to defray special expenses entailed on him by the nature of his employment;

(e) any gratuity payable on discharge or retirement; or

(f) any annual bonus or any part of any annual bonus;

 

How to add Allowance to OT rate

Example of adding OT rate. Details on how to edit allowance can be found here : https://kb.actpayroll.com/knowledge-base-2/start/allowances-deductions/


 

Overtime Rate Options

  1. OT (1.0)
    i) This entry will calculate hours x hourly rate, but in this case it will be categorized as overtime.
    ii) This can be used for cases where employees have contractual overtime rates.
  2. 1.5 Normal day overitme
  3. 2.0 Rest day overtime exceeding 8 hours
  4. 3.0 Public Holiday overtime exceeding 8 hours.

Please note rate for Rest days and Public  Holidays for Monthly or Weekly rated employee.

Rest day :  he shall be paid for any period of work which does not exceed half his normal hours of work, wages equivalent to half the ordinary rate of pay for work done on that day; or (ii) which is more than half but which does not exceed his normal hours of work, one day’s wages at the ordinary rate of pay for work done on that day.

Public Holiday :  be paid two days’ wages at the ordinary rate of pay regardless that the period of work done on that day is less than the normal hours of work.

OT Days

Based on the above definition of rest day and public holiday rates, this field should be used for work carried out on rest days and public holidays. The total will be “daily rate” x “no. of days”.

Rest Days
i) This is for calculating rest days worked. The value must be a multiple of 0.5.
ii) The amount calculated is days x daily rate for monthly rated workers and days.
iii) For daily rated workers, it days x daily rate x 2.

Public Holidays.
i) This is for calculating public holidays worked. The value must be a multiple of 0.5.
ii) The amount calculated is days x daily rate x 2 for monthly rated workers and days.
iii) For daily rated workers, it days x daily rate x 3.

Deductions

  1. Hours Deduct : Deduct “hours” x 1.0
  2. Days Deduct : Deduct based on formula “daily rate” = basic pay / 26
  3. Prorated Days : Deduct based on formula “daily rate” = basic pay / no. of days in month. (This option will be available in April 2016 Update)

 

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