Overtime Pay in Australia: Complete Guide to Rates, Laws & Your Rights (2026)

If you have ever stayed back late, worked a weekend, or powered through a public holiday and wondered whether you were being paid correctly — this guide is for you.

Overtime pay in Australia is one of the most misunderstood areas of workplace law. Unlike the United States, where a simple federal rule says "anything over 40 hours a week is overtime at 1.5x," Australia's system is considerably more nuanced. What you are entitled to depends on your industry, your specific award or enterprise agreement, when the extra hours are worked, and your employment type.

Getting it wrong costs money — sometimes a lot of it. In 2024 and 2025, some of Australia's biggest underpayment scandals involved exactly these kinds of overtime and penalty rate errors, with large employers owing workers millions in back pay.

This guide covers the full picture: the legal framework, who is eligible, who is exempt, how rates are calculated, worked examples for real scenarios, what applies state by state, and how to check whether you are being paid correctly.

Use the Dolaro Overtime Pay Calculator to calculate your exact entitlements instantly.

The Legal Framework: What Governs Overtime in Australia

The Fair Work Act 2009

Overtime in Australia is primarily governed by the Fair Work Act 2009 and administered by the Fair Work Ombudsman. The Act establishes the National Employment Standards (NES), which set a baseline of 38 ordinary hours per week for full-time employees — with provision for "reasonable additional hours" on top.

Critically, the Act does not set a single overtime rate. Instead, it delegates overtime rules to modern awards and enterprise agreements, which vary by industry and occupation.

A New Protection: The Fair Work Amendment (Protecting Penalty and Overtime Rates) Act 2025

A significant legislative change took effect from 30 August 2025. This amendment to the Fair Work Act now requires the Fair Work Commission to ensure that penalty rates and overtime rates under modern awards cannot be reduced. These rates are now protected as fundamental entitlements for approximately 2.6 million Australian workers covered by modern awards.

In practice, this means the Fair Work Commission cannot lower overtime rates as part of award reviews — a protection that did not previously exist in this form. For the full detail on this legislation, see our guide: Fair Work Amendment (Protecting Penalty and Overtime Rates) Act 2025.

Modern Awards

There are currently 121 modern awards in Australia's national workplace relations system, each covering a specific industry or occupation. Every award contains its own schedule of overtime rates, overtime triggers, and penalty rates for different times of day and week.

Common awards you may be covered by include:

General Retail Industry Award 2020 (MA000004) — retail workers
Hospitality Industry (General) Award 2020 (MA000009) — hotels, restaurants, cafes
Clerks — Private Sector Award 2020 — office and admin workers
Building and Construction General On-site Award 2020 — construction workers
Health Professionals and Support Services Award 2020 — healthcare workers
Social, Community, Home Care and Disability Services Industry Award 2010 (SCHADS) — care workers If you are unsure which award covers you, the Fair Work Ombudsman's Pay and Conditions Tool at fairwork.gov.au lets you identify your award by industry and job type.

Enterprise Agreements

Some workplaces operate under an Enterprise Agreement (EA) — a negotiated agreement between an employer and a group of employees, approved by the Fair Work Commission. EAs can offer different terms to awards but must pass the Better Off Overall Test (BOOT), meaning employees must be better off overall under the agreement than they would be under the applicable award.

Award-Free Employees

Employees earning above the high income threshold ($183,100 per year for 2025-26) may not be covered by a modern award if they have a written guarantee of annual earnings from their employer. For these employees, overtime entitlements are determined by their employment contract. If the contract is silent on overtime, the NES "reasonable additional hours" framework applies, but there is no prescribed rate.

Overtime vs. Penalty Rates: What Is the Difference?

These two terms are often confused, and for good reason — in some situations, they overlap.

Overtime refers to pay for hours worked beyond an employee's ordinary hours, as defined by their award or agreement. For most full-time employees, this means hours beyond 38 per week, or beyond a daily limit specified in their award (often 7.6 or 10 hours per day).

Penalty rates are higher pay rates that apply when working at particular times — evenings, nights, weekends, or public holidays — regardless of how many total hours you have worked that week. A part-time employee who works only 20 hours per week can still earn penalty rates for Sunday work, even though they are nowhere near overtime territory.

In some situations, both can apply simultaneously. For example, a full-time employee who works more than 38 hours in a week and those extra hours fall on a Sunday may be entitled to both overtime rates and Sunday penalty rates — whichever is higher, or in some awards, both stacked together. Always check your specific award.

Who Is Eligible for Overtime Pay in Australia?

Most Australian employees are entitled to overtime pay when they work beyond their ordinary hours — but eligibility depends on whether you are covered by a modern award, an enterprise agreement, or neither.

Employees covered by a modern award have overtime entitlements set out in that award. The award specifies what ordinary hours are, when overtime begins, and what rate applies. Employees covered by a modern award are entitled to overtime pay whenever they work beyond the award's thresholds — the employer cannot contract out of these entitlements.

Employees covered by an enterprise agreement have overtime entitlements set by that agreement rather than the underlying award. Some EAs — particularly in mining and large corporate environments — use annualised salary or composite rate arrangements that compensate for overtime as part of a total package. Under these arrangements, overtime within the agreed roster typically does not attract additional pay.

Award and agreement free employees have their overtime entitlements set by the NES and their employment contract. The NES provides for a maximum of 38 ordinary hours per week with "reasonable additional hours" on top, but award-free employees do not have a statutory right to overtime pay at a higher rate unless their contract provides for it.

Part-time employees are entitled to overtime when they work beyond their agreed ordinary hours under their award or agreement. Under many awards, a part-time employee working beyond their contracted hours (but still under 38 hours) may be entitled to overtime rates for those extra hours — not just hours beyond 38.

Casual employees can be entitled to overtime under most federal modern awards — see the dedicated casual overtime section below.

Overtime Exemptions in Australia: Who Doesn't Get Overtime?

Several categories of workers are exempt from standard overtime entitlements.

High Income Employees with a Guarantee of Annual Earnings

The most significant overtime exemption applies to employees who earn above the high income threshold (currently $183,100 per year for 2025-26) and have a written guarantee of annual earnings from their employer. An employee who meets both conditions is award-free — the modern award and its overtime clause do not apply. Their overtime entitlements (if any) come from their employment contract.

Both conditions must be met: earning above the threshold alone is not sufficient. There must be a written guarantee of annual earnings in place before or within 14 days of the start of employment. The threshold is indexed annually on 1 July — in 2024-25 it was $175,000.

Even with a valid guarantee, the employee retains NES entitlements — including maximum weekly hours, leave entitlements, and public holiday provisions.

Genuine Independent Contractors

Contractors are not employees and have no award-based overtime entitlements. However, the distinction between employee and contractor is determined by the actual nature of the relationship, not what the parties call it. From 26 August 2024, the Fair Work Act applies a "whole of relationship" test. Misclassifying an employee as a contractor to avoid overtime obligations (sham contracting) is a serious civil penalty under the Fair Work Act.

Employees on Annualised Salary Arrangements

Some modern awards permit employers to pay an annualised salary that compensates for expected overtime. These are not a blanket exemption — the employer must keep records of actual hours worked and conduct an annual reconciliation. If the employee would have been better off under award rates, the shortfall must be paid. After the Federal Court's decision in Fair Work Ombudsman v Woolworths Group Limited [2025] FCA 1092, reconciliation requirements have been clarified and tightened.

Employees Whose Awards Define Certain Hours as Ordinary Time

Some awards classify hours that might intuitively seem like "overtime" — late evenings, early mornings, weekends — as ordinary hours within the span of hours, subject to penalty rates rather than overtime rates. Overtime under these awards only applies when daily or weekly maxima are exceeded. A hospitality worker on a late Saturday shift is typically on ordinary hours with penalty rates, not overtime.

When Does Overtime Start?

There is no single trigger that applies to all Australian employees. Different awards use different mechanisms.

Is Overtime Calculated Daily or Weekly in Australia?

Weekly trigger (most common): Overtime applies after an employee works more than their ordinary weekly hours — typically 38 hours for full-time employees. Regardless of how many hours are worked on any single day, overtime only applies to the excess over the weekly total.

Awards using weekly triggers: Clerks — Private Sector Award, General Retail Industry Award, most professional services awards.

Daily trigger: Overtime applies when a single day's hours exceed the daily maximum (typically 8 or 10 hours in the award), regardless of weekly total. A worker on a daily trigger award can earn overtime on a long Monday even in an otherwise short week.

Awards using daily triggers: Building and Construction Award, some manufacturing awards.

Both triggers (whichever is reached first): Some awards specify overtime when either the daily maximum or the weekly maximum is exceeded — whichever comes first.

Span of hours: Many awards define a span of ordinary hours by time of day (e.g. 7am–6pm). Work outside this span attracts penalty rates even if daily and weekly totals have not been exceeded.

Can Employers Average Hours to Avoid Overtime?

Generally no. Unless an award expressly contains an averaging arrangement, employers cannot average hours across pay periods. If an employee works 45 hours one week and 30 hours the next, the 45-hour week triggers overtime — the employer cannot average the two weeks together. Only awards that explicitly provide for averaging (common for FIFO and shift workers) permit this approach.

Worked Example: Daily vs Weekly — Same Hours, Different Outcome

An employee works: Monday 12 hours, Tuesday–Friday 6 hours each. Total: 36 hours.

Trigger structure	Overtime?
Weekly trigger (max 38 hrs/week)	No — only 36 hours worked
Daily trigger (max 8 hrs/day)	Yes — 4 hours overtime on Monday
Both triggers	Yes — 4 hours overtime on Monday

Same 36-hour week. Entirely different overtime outcome depending on the award.

Overtime Rates: The Numbers

Standard Overtime Rates Under Most Awards

When overtime is worked	Rate	Multiplier
First 2–3 hours of overtime (weekday)	Time and a half	1.5×
Beyond 2–3 hours of overtime (weekday)	Double time	2.0×
Saturday (many awards)	Time and a half	1.5×
Sunday (many awards)	Double time	2.0×
Public holidays (most awards)	Double time and a half	2.5×

These are the most common rates across the 121 modern awards. Your specific award may differ — always verify at fairwork.gov.au.

Overtime Rates by Key Industry Award (2025–26)

General Retail Industry Award (MA000004)

Overtime period	Rate
First 3 hours weekday overtime	150%
After 3 hours weekday overtime	200%
Saturday	150%
Sunday (permanent)	150%
Public holiday	250%

Hospitality Industry (General) Award (MA000009)

Overtime period	Rate
Weekday overtime (first hours)	150%
Weekday overtime (additional)	200%
Saturday	125%
Sunday	150%
Public holiday	225%
Evening work after 7pm	115%

Building and Construction General On-site Award

Overtime period	Rate
First 2 hours weekday overtime	150%
Beyond 2 hours weekday overtime	200%
Saturday	150%
Sunday	200%
Public holiday	250%

Nurses Award / Health Professionals Award

Overtime period	Rate
Weekday overtime	150% then 200%
Saturday	150%
Sunday	200%
Public holiday	250%

How to Calculate Overtime Pay: Step-by-Step

Overtime Pay = Hourly Rate × Overtime Multiplier × Overtime Hours

Example 1 — Standard Full-Time Employee (Clerks Award)

Sarah is a full-time admin worker earning $32.00/hr under the Clerks — Private Sector Award. Ordinary hours: 38/week. She works 43 hours in one week — 5 hours of overtime. Award: 150% for first 2 hours, 200% after.

Hours	Rate	Calculation	Pay
First 2 overtime hours	150%	2 × $32.00 × 1.5	$96.00
Next 3 overtime hours	200%	3 × $32.00 × 2.0	$192.00
Total overtime pay			$288.00

Normal pay for 38 hours: $1,216.00 → Total: $1,504.00

Example 2 — Hospitality Worker (Weekend Shift)

Marco is a full-time food and beverage attendant earning $26.55/hr. He works his normal 38-hour week plus a 4-hour Sunday shift. Sunday is overtime (already at 38 hours). Award applies the higher of overtime rate or penalty rate — here double time (200%) applies.

Period	Rate	Calculation	Pay
Sunday 4 hours (overtime)	200%	4 × $26.55 × 2.0	$212.40

Example 3 — Retail Casual (Public Holiday)

Priya is a casual retail worker at a base rate of $20.40/hr (award base), with 25% casual loading → casual ordinary rate $25.50/hr. She works 5 hours on a public holiday. Under the General Retail Industry Award, public holiday work attracts 250%.

Period	Rate	Calculation	Pay
5 hours on public holiday	250%	5 × $25.50 × 2.5	$318.75

Example 4 — Part-Time Employee Exceeding Contracted Hours

James is a part-time retail worker contracted to 20 hours/week at $28.00/hr. He works 26 hours in one week — 6 hours beyond his contract. Award: 150% first 3 hours, 200% after.

Hours	Rate	Calculation	Pay
20 contracted hours	Ordinary	20 × $28.00	$560.00
First 3 overtime hours	150%	3 × $28.00 × 1.5	$126.00
Next 3 overtime hours	200%	3 × $28.00 × 2.0	$168.00
Total weekly earnings			$854.00

Example 5 — Construction Worker (Long Day)

Dave is a full-time construction worker at $40.00/hr under the Building Award. He works a 12-hour day with 30 minutes unpaid break = 11.5 working hours. Daily ordinary hours under the award: 7.6 hours. Overtime: 3.9 hours.

Period	Rate	Calculation	Pay
Ordinary 7.6 hours	100%	7.6 × $40.00	$304.00
First 2 overtime hours	150%	2 × $40.00 × 1.5	$120.00
Remaining 1.9 overtime hours	200%	1.9 × $40.00 × 2.0	$152.00
Total day's earnings			$576.00

Do Casual Employees Get Overtime in Australia?

Yes — most casual employees are entitled to overtime under federal modern awards when they work beyond their ordinary hours thresholds.

The casual loading (typically 25%) is paid on ordinary hours. When a casual employee works overtime, the overtime rate multiplier is applied to the base rate (without casual loading) — not the casual-inclusive rate. The casual loading and the overtime rate are then combined.

Correct calculation:

Base rate: $25.00/hr
Casual ordinary rate: $25.00 × 1.25 = $31.25/hr
Overtime rate (150%): $25.00 × 1.5 = $37.50/hr ← applied to base rate, not $31.25

Some awards calculate differently — applying the multiplier to the full casual rate. Always check your specific award's overtime clause for casuals or use the Fair Work Ombudsman's Pay and Conditions Tool selecting casual employment type.

Casual employees are also entitled to public holiday penalty rates when required to work on a gazetted public holiday. The public holiday rate is typically applied to the casual ordinary rate (base + loading), resulting in effective rates of 225–250%+ depending on the award.

State-by-State: Is Overtime Different Across Australia?

The National System (NSW, VIC, QLD, SA, TAS, ACT, NT)

Most private sector employees in these states are covered by the same federal Fair Work system. Overtime rates are set by modern awards — not by the state. What varies by state:

Public holidays — each state has different gazetted public holidays. A public holiday in Victoria (AFL Grand Final Friday) is not a public holiday in Queensland. Since public holiday work attracts 250% under most awards, which holidays fall in your state has a direct dollar impact.
Long service leave — state-specific rules.
State public sector employees — most are covered by state industrial systems, not the Fair Work Act. | State/Territory | System | Key note | |---|---|---| | NSW | National (Fair Work) | Labour Day October; Easter Saturday is a public holiday | | VIC | National (Fair Work) | AFL Grand Final Friday; Labour Day March | | QLD | National (Fair Work) | Labour Day May; Ekka (Brisbane only); Christmas Eve part-day | | SA | National (Fair Work) | Adelaide Cup; Proclamation Day | | TAS | National (Fair Work) | Eight Hours Day | | ACT | National (Fair Work) | Canberra Day; Family & Community Day | | NT | National (Fair Work) | Picnic Day | | WA (most private sector) | National (Fair Work) | Labour Day March; WA Day June; King's Birthday September | | WA state system | WA Industrial Relations | Sole traders, partnerships, unincorporated entities |

For state-specific guides including 2026 public holiday calendars and state IR system details:

Western Australia: The Exception

WA is the only state with a significant parallel industrial relations system. Most larger private sector employers in WA are in the national system. However, sole traders, unincorporated partnerships, and certain associations in WA may be governed by the Western Australian Industrial Relations Commission (WAIRC) and WA state awards. For WA state system queries, contact Wageline at wageline.wa.gov.au.

Time Off in Lieu (TOIL): An Alternative to Overtime Pay

Instead of overtime pay, some employees receive time off in lieu (TOIL) — paid time off at a later date. TOIL is not automatically available. It requires:

Your award or enterprise agreement must specifically permit TOIL
A written agreement between you and your employer — made before the overtime is worked
TOIL must be taken at the overtime rate — 2 hours overtime at 150% = 3 hours TOIL (not 2)
TOIL must be taken within the period specified in the award (typically 4–12 weeks) TOIL does not replace annual leave and is tracked separately. Unused TOIL must be paid out if you leave employment.

Salaried Employees and Overtime

A common misconception is that salaried employees have no overtime entitlements. This is not always true.

If your annual salary is set to compensate for expected overtime (under an annualised salary arrangement), your employer must still conduct a reconciliation comparing your total pay against what you would have earned under award rates including overtime. If you would have earned more under the award, the employer must make up the difference.

This is a common source of underpayment for salaried workers in retail management, hospitality management, and similar roles — particularly after the Woolworths v FWO Federal Court decision in September 2025, which clarified that reconciliations must be conducted with care and on the correct intervals.

Is Superannuation Paid on Overtime?

No — superannuation is generally not paid on overtime. This is one of the most commonly misunderstood aspects of overtime pay.

The Superannuation Guarantee (SG) is calculated on Ordinary Time Earnings (OTE) as defined by the ATO in Superannuation Guarantee Ruling SGR 2009/2. OTE explicitly excludes overtime payments. Your employer's 12% SG obligation is based on your ordinary wages — not your total earnings including overtime.

What counts as OTE (super is paid on these): Base salary, shift loadings for ordinary hours, penalty rates for ordinary hours, casual loading, paid leave, commissions for ordinary hours work.

What is excluded from OTE (super is not paid on these): Overtime payments, expense reimbursements, workers compensation, lump sum termination payments.

Exceptions apply where your employment contract or enterprise agreement explicitly includes overtime in the super calculation — this overrides the default.

For the full detail: Is Super Paid on Overtime in Australia?

Can Your Employer Force You to Work Overtime?

Under section 62 of the Fair Work Act, employers must not require employees to work unreasonable additional hours. What is "reasonable" is assessed case by case and includes:

Risk to health and safety (including fatigue)
Personal circumstances, including caring responsibilities
Amount of notice given
Whether additional pay or compensation is provided
The nature of the role and industry
The usual pattern of work in the industry You cannot be dismissed or disadvantaged for refusing genuinely unreasonable overtime.

Is Overtime Taxed Differently?

No. Overtime pay is taxed as ordinary income in Australia — it is added to your regular pay for the period and taxed at your marginal rate through the PAYG withholding system. There is no separate overtime tax rate.

Because overtime pushes your total earnings for the pay period higher, PAYG withholding may be higher for that fortnight. This is not a permanent higher tax — it evens out when you lodge your annual tax return.

How to Check If You Are Being Underpaid

Step 1 — Identify your award. Use the Fair Work Ombudsman's Pay and Conditions Tool at fairwork.gov.au.

Step 2 — Find your classification. Most awards have multiple levels. Find the classification that matches your skills and responsibilities.

Step 3 — Calculate what you should have been paid. Use the Dolaro Overtime Pay Calculator.

Step 4 — Compare to your payslips. Employers must keep time and wage records for seven years. You are entitled to request these.

Step 5 — If there is a discrepancy. Raise it with your employer in writing. If unresolved, contact the Fair Work Ombudsman on 13 13 94 or lodge a complaint at fairwork.gov.au. The FWO has investigative powers and can recover unpaid wages on your behalf.

Frequently Asked Questions

What is the overtime rate in Australia?

The most common rate under most modern awards is time and a half (150%) for the first 2–3 hours of overtime, then double time (200%) after that. Public holiday overtime is typically double time and a half (250%). Your exact rate depends on your modern award or enterprise agreement — verify at fairwork.gov.au.

When does overtime start in Australia?

For most full-time employees, overtime starts after 38 ordinary hours per week. Many awards also have daily overtime triggers — for example, after 10 hours in a single day under the Hospitality Award. Part-time employees generally trigger overtime when they exceed their contracted hours. Check your specific award's Hours of Work and Overtime clause.

Is overtime calculated daily or weekly in Australia?

It depends on your modern award. Some awards use a weekly trigger (overtime after 38 hours/week). Others use a daily trigger (overtime after 8–10 hours/day). Some use both. There is no single national rule — always check your specific award.

Who is exempt from overtime in Australia?

Employees earning above the high income threshold ($183,100 in 2025-26) with a written guarantee of annual earnings are award-free and have no statutory overtime entitlement. Genuine independent contractors have no award-based overtime entitlements. Employees on annualised salary arrangements under awards that permit them may not receive separate overtime payments, subject to reconciliation requirements.

Do casual workers get overtime in Australia?

Yes. Casual employees are entitled to overtime under most modern awards once they exceed the relevant daily or weekly thresholds. The overtime multiplier is applied to the base rate (before casual loading), not the casual-inclusive rate. Check your specific award's casual overtime clause or use the Fair Work Ombudsman's Pay and Conditions Tool.

Is superannuation paid on overtime in Australia?

No — not under the default Superannuation Guarantee rules. Overtime is excluded from Ordinary Time Earnings (OTE) under the Superannuation Guarantee (Administration) Act 1992. Your employer's 12% SG obligation is based on ordinary wages only, not total earnings including overtime. Exceptions apply where a contract or enterprise agreement explicitly includes overtime in the SG calculation. See: Is Super Paid on Overtime?

Is overtime pay different in Victoria vs New South Wales?

No — both states are in the national Fair Work system, and overtime rates are set by modern awards, not by the state. What varies is which public holidays are gazetted in each state, since public holiday work attracts higher rates (250% under most awards). NSW Labour Day is in October; VIC Labour Day is in March.

Can my employer make me take TOIL instead of overtime pay?

Only if your modern award or enterprise agreement permits TOIL and you have a written agreement in place before the overtime is worked. Your employer cannot unilaterally substitute TOIL for cash entitlements without meeting these conditions.

Is overtime taxed more in Australia?

No. Overtime is not taxed at a separate, higher rate. It is added to your regular income and taxed at your marginal rate. Higher PAYG withholding in a given pay period evens out at your annual tax return.

What is the high income threshold for overtime exemption in Australia?

The high income threshold for 2025-26 is $183,100 per year. An employee earning above this amount under a written guarantee of annual earnings from their employer is award-free — the modern award and its overtime clause do not apply. The threshold is indexed annually on 1 July.

What if my employer refuses to pay overtime?

Raise the issue in writing with your employer first. If unresolved, contact the Fair Work Ombudsman on 13 13 94 or lodge a complaint at fairwork.gov.au. Underpayment of award entitlements is a legal breach. The FWO has investigative powers and can recover wages on your behalf. Significant penalties apply for deliberate wage theft.

Where can I find my specific overtime rates?

The Fair Work Ombudsman's Pay and Conditions Tool at fairwork.gov.au is the authoritative source. Use the Dolaro Overtime Pay Calculator to calculate your entitlements based on your hourly rate and hours worked.

Final Word

Overtime pay in Australia sits at the intersection of federal law, 121 different modern awards, enterprise agreements, employment types, and state-specific public holiday calendars. That complexity is why underpayment of overtime is so common — and why understanding your specific entitlements matters.

Key takeaways:

Overtime rules are set by your specific modern award or enterprise agreement — not a single national rule
For most employees, overtime starts at 150% (time and a half) for the first 2–3 hours, then 200% (double time)
Public holidays attract up to 250% under most awards
Casual employees are entitled to overtime — the multiplier applies to the base rate, not the casual-inclusive rate
Superannuation is not paid on overtime — overtime is excluded from OTE under the SG rules
Western Australia is the only state with a parallel industrial relations system for some employers
Salaried employees on awards must still have their total compensation tested against all award entitlements including overtime
High income employees earning above $183,100 with a guarantee of annual earnings are award-free
As of 30 August 2025, penalty and overtime rates in modern awards are legally protected from being reduced

This article is general information only and does not constitute legal or financial advice. Overtime entitlements depend on your specific award, enterprise agreement, and employment circumstances. For authoritative guidance, contact the Fair Work Ombudsman at fairwork.gov.au or on 13 13 94.