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Pakistan country pack — this guide covers Pakistan-specific statutory rules. Octal HR is configurable for other regions too.

Overview

Overtime (OT) pay is the additional compensation an employee earns for hours worked beyond their standard shift. In Octal HR, overtime is calculated from attendance records — biometric or manual — and pushed automatically into the payroll run as an earning component. You configure the rules once; the system does the math every month.

Pakistan labour law context

Under the Factories Act 1934 and applicable provincial labour laws:

  • Standard working hours: 8 hours/day, 48 hours/week
  • Maximum overtime: 12 hours/day (4 OT hours), not exceeding 624 hours/year
  • Overtime rate: minimum 2× (double) the hourly wage for hours beyond the daily limit
  • Rest day work: paid at double rate for the first 8 hours, and triple for hours beyond that

Octal HR defaults the weekday OT multiplier to 1.5× and the weekend and holiday multipliers to 2×. You can raise any of these (e.g., 2.5× for Friday / rest-day OT) to match your labour policy.

How OT pay is calculated

Octal HR derives an hourly rate from the employee's salary, then multiplies the recorded overtime hours by that rate and the standard OT multiplier from the applicable rule. Separate weekend and holiday multiplier fields exist on the rule for future use, but payroll does not currently switch multipliers automatically based on day type.

OT pay Multiplier

Formula
OT pay = Hourly rate × OT hours × Multiplier
Example — Hourly rate PKR 288.46, 10 OT hours, 2× weekday multiplier
OT rate = 288.46 × 2 = PKR 576.92/hr
10 OT hours → PKR 5,769 additional pay

The OT hours themselves come from each day's attendance record (entered by HR or through attendance processing), not from raw punches. OT is paid at the standard OT multiplier defined on the applicable rule — payroll does not currently vary the multiplier by whether the day is a normal working day, weekend / off day, or public holiday. If a higher payout is needed for off-day or holiday work, reflect it by adjusting the OT hours entered.

Configure the overtime rule

1
Settings → Overtime Rules — Click New Rule.
2
Name the rule — e.g., "Head Office OT" or "Factory Floor OT".
3
Applies to — Choose all employees, a department, or a designation.
4
Daily threshold — Hours after which OT applies (default: 8). Optionally set a weekly threshold too.
5
Multipliers — Set the weekday OT multiplier, the weekend / off-day multiplier, and the public-holiday multiplier.
6
Max OT hours / month — Optional cap on paid OT hours per employee per month. Save.

Overtime hours are taken from the daily attendance record, where an OT-hours value is stored for each day. Ensure attendance data is complete before running payroll:

  • Biometric / device attendance syncs automatically each night
  • Manual attendance can be entered under Attendance → Manual Entry, including the day's OT hours
  • Regularisation requests should be approved before you run payroll
  • The OT hours recorded on each day are what payroll multiplies by the rate

How OT flows into payroll

When you initiate payroll for a month, Octal HR:

  1. Reads each employee's attendance records for the payroll period
  2. Sums the OT hours recorded across those days
  3. Applies the matching overtime rule (threshold + multiplier)
  4. Adds the OT amount as the "Overtime" earning component on the payslip
  5. Includes OT pay in the taxable income for WHT calculation

Overtime appears as a separate line on the payslip.

Overtime reports

ReportLocationPurpose
Monthly OT SummaryPayroll → ReportsTotal OT hours and pay by department
Employee OT DetailPayroll → ReportsDay-by-day OT hours for an employee
OT Trend (6-month)Dashboard widgetSpot departments with chronic overtime
OT Cost AnalysisPayroll → ReportsOT pay as % of total payroll cost