Payroll items - Overtime

Default Overtime items

Malaysia Act 60A(3)
For any overtime work carried out in excess of the normal hours of work, the employee shall be paid at a rate not less than one and half times his hourly rate of pay irrespective of the basis on which his rate of pay is fixed.
In this section, “Overtime” means the number of hours of work carried out in excess of the normal hours of work per day: Provided that if any work is carried out after the spread over period of ten hours, the whole period beginning from the time that the said spread over period ends up to the time that the employee ceases work for the day shall be deemed to be overtime.
For the purposes of this section, section 60, section 60D(3)(a), and section 60I, “normal hours of work” means the number of hours of work as agreed between an employer and an employee in the contract of service to be the usual hours of work per day and such hours of work shall not exceed the limits of hours prescribed in subsection (1). "
So, you have to note the meaning of "normal hours of work" as above. If the 30 hours per week is clearly mentioned as the agreed normal hour of work, then I think you will agree that overtime is payable for any work done after the 30 hours.
In general, follow these steps to calculate the amount of overtime pay owed to an employee:
  • Determine whether the individual is eligible for overtime. The person might not qualify as an employee, or may instead be paid on a salaried basis, in which case overtime rules do not apply.
  • Determine the hourly rate of pay, which is the total amount paid in the period divided by the number of hours worked.

5 working days example: 

  • Working hours: Monday to Friday 8 AM - 5 PM = Total 9 hours/day

    OT on weekday (Normal Day) = (salary/26 days/8 hours) x 1.5 x OT hours
    OT on off day (Rest Day) = (salary/26 days/8 hours) x 2 x  OT hours
    OT on Public holiday = (salary/26 days/8 hours) x 3 x  OT hours

6 working days examples:

  • Working hours: Monday to Friday (8 hours/day) and Saturday (5 hrs) = Total 45 hours/week 
    ORP = monthly salary / 26
    HRP = ORP / 8 hrs

  • Working hours: Monday to Saturday (7.5 hours/day) = Total 45 hours/week

    ORP = monthly salary / 26
    HRP = ORP / 7.5 hrs

    Ordinary Rate of Pay (ORP)
    Hourly Rate of Pay (HRP)
    As long as the total working hour in a week is max 45 hrs.
There may be situations where an employee is paid different rates at different times during the work period. Here are some scenarios that we have created by default:
Customise Overtime items

However, if the default overtime items are not suitable to your company's needs, you may customize them accordingly.