Philippine Overtime Pay Computation: DOLE Rules, Formulas & Rates

In the Philippines, the normal hours of work for any employee cannot exceed eight (8) hours per day (exclusive of a 60-minute unpaid meal period). When an employee renders work beyond their regular eight-hour shift, they are legally entitled to Overtime Pay (OT) under Article 87 of the Labor Code of the Philippines.

Philippine Overtime Multiplier Summary

The exact overtime rate depends on whether the overtime work takes place on a regular working day, a rest day, or a statutory holiday:

Key Legal Rules Governing Overtime

1. Overtime Cannot Offset Undertime (Article 88)

A common misconception among business owners is offsetting hours: allowing an employee who arrives 2 hours late on Monday to work 2 hours past their shift on Tuesday without paying overtime. Article 88 of the Labor Code explicitly prohibits this:

2. Daily Basis, Not Weekly Total

Overtime is determined on a daily basis (hours worked beyond 8 hours in a given 24-hour cycle), not based on a cumulative 40-hour or 48-hour weekly threshold. Working 10 hours on Monday entitles the employee to 2 hours of overtime pay, regardless of whether they only work 30 total hours during that week.

3. Prior Management Authorization

While statutory overtime must be paid for hours worked, companies have the legal right to enforce overtime pre-approval policies. Unapproved or unauthorized overtime may subject an employee to disciplinary review, though actual hours worked under employer knowledge must still be compensated.

Worked Overtime Calculation Examples