UAE Overtime Calculator

How Is Overtime Calculated in the UAE?

Overtime in the UAE is calculated using an employee's basic hourly wage and the number of additional hours worked beyond their normal schedule. Under Article 19 of Federal Decree-Law No. 33 of 2021, eligible employees receive their normal basic hourly wage plus an additional percentage depending on when the overtime is performed.

For ordinary overtime, the minimum additional payment is 25% of the basic hourly wage. If qualifying overtime takes place between 10 PM and 4 AM, the additional payment increases to at least 50%. The higher night overtime rate does not apply to employees working on a shift basis.

For example, an employee earning AED 25 per hour in basic wages would receive at least AED 31.25 for an hour of regular overtime or AED 37.50 for an eligible hour of night overtime.

Employers must also account for separate compensation requirements when employees work on their designated weekly rest days or official public holidays.

UAE Overtime Pay Rates Under Labour Law

The UAE Labour Law establishes minimum overtime rates for eligible private-sector employees. These rates depend on whether the extra work takes place during normal working days, at night, or on a designated day off.

The percentages represent minimum statutory entitlements. An employment contract or company policy may provide higher overtime payments.

It's also important to distinguish regular overtime from rest-day and public-holiday compensation. The latter provisions refer to the normal day's wage plus an additional amount based on basic wage, rather than simply applying the ordinary hourly overtime multiplier.

UAE Overtime Calculation Formula

The standard approach to calculating ordinary overtime begins with the employee's basic hourly wage.

For a monthly-paid employee working a normal eight-hour day, the following commonly used formula is also illustrated in MOHRE guidance:

Basic Hourly Wage = Monthly Basic Salary ÷ 30 ÷ 8

Once the hourly wage is established, the applicable overtime rate determines the payment.

Regular Overtime Calculation

Regular overtime is paid at a minimum of 125% of the basic hourly wage.

Regular Overtime Pay = Basic Hourly Wage × 1.25 × Overtime Hours

Night Overtime Calculation

Eligible overtime between 10 PM and 4 AM is paid at a minimum of 150% of the basic hourly wage.

Night Overtime Pay = Basic Hourly Wage × 1.50 × Night Overtime Hours

The 150% night rate does not apply to shift-based employees under the relevant provision of Article 19.

These formulas calculate the payment for overtime hours, including the normal basic hourly rate and the required premium.

They should not be confused with a calculation of only the additional 25% or 50% premium.

The 30-day and eight-hour basis is appropriate for the standard example shown here. Different legally applicable working arrangements or contractual hourly-wage methods may require adjustments.

UAE Overtime Calculation Example

Suppose an employee in Dubai earns a monthly basic salary of AED 6,000 and normally works eight hours per day.

During the month, the employee completes eight hours of ordinary overtime and four hours of qualifying night overtime across different working days.

The overtime calculation would be:

In this example, the employee earns AED 400 in overtime payments in addition to their regular monthly salary.

The example assumes the employee qualifies for the night overtime premium and that all additional hours were worked within applicable working-time requirements.

Is Overtime Calculated on Basic Salary or Gross Salary in the UAE?

Overtime under the standard federal UAE Labour Law is calculated using the employee's basic wage rather than their total gross salary.

An employee's gross salary may include housing, transportation, and other allowances, but these additional components are not included when determining the basic hourly wage for ordinary overtime.

Consider an employee receiving AED 8,000 per month, consisting of AED 5,000 in basic salary and AED 3,000 in allowances.

For an ordinary overtime calculation using a 30-day month and eight-hour working day, the hourly basic wage would be approximately AED 20.83, calculated from the AED 5,000 basic salary.

Using the full AED 8,000 instead would produce a higher hourly rate that is not the required statutory basic-wage calculation.

For employers, maintaining a clear distinction between basic salary and allowances is essential when calculating overtime, gratuity, and other salary-based entitlements.

How Is Night Overtime Calculated in the UAE?

Night overtime is generally paid at 150% of the employee's basic hourly wage when eligible additional working hours fall between 10 PM and 4 AM.

The higher rate applies to qualifying overtime during those hours, not automatically to every employee whose normal working schedule includes night work.

For example, someone whose regular shift ends at 10 PM and who continues working until midnight may qualify for night overtime compensation for those additional two hours, depending on their employment arrangement.

However, Article 19 excludes employees who work on a shift basis from the specific 50% night overtime premium.

This distinction is particularly important for businesses operating around the clock, such as hospitals, hotels, security companies, and manufacturing facilities. Employers should review working schedules and employee eligibility before applying the higher night rate.

How Is Overtime Paid for Weekly Rest Days?

When an employee is required to work on their designated weekly rest day, federal UAE Labour Law provides for either a substitute rest day or payment of the normal day's wage plus an additional amount of at least 50% of that day's basic wage.

The employee's designated rest day is determined by the employment contract or applicable workplace regulations. It is not necessarily Saturday or Sunday.

For example, if an employee's basic daily wage is AED 200 and their normal daily wage including allowances is AED 250, the statutory payment formula for working a full rest day without substitute time off would be at least AED 350 for that day.

The actual additional amount to be paid through payroll must account for what the employee has already received as part of their regular salary, so the same wages are not counted twice.

Employers should record whether the employee received a substitute rest day or monetary compensation before finalising the payroll calculation.

How Is Overtime Calculated on UAE Public Holidays?

Employees required to work on an official UAE public holiday are entitled to additional compensation under Article 28 of the UAE Labour Law.

The employer must provide another rest day for each public holiday worked or pay the normal day's wage plus an additional amount of at least 50% of the day's basic wage.

The treatment is different from simply applying a 25% ordinary overtime premium, because public holidays are already recognised as paid leave under the federal employment framework.

For payroll purposes, employers should identify the relevant public holiday, the employee's actual working hours, and whether a substitute day off has been provided.

This helps ensure that the employee receives the correct holiday entitlement without duplicating amounts already included in regular salary payments.

How Many Overtime Hours Are Allowed in the UAE?

Under Article 19 of the UAE Labour Law, employers may generally require an employee to work no more than two additional hours per day. Exceptions are allowed under the conditions specified in the implementing regulations, including circumstances involving serious accidents or substantial losses.

The legislation also specifies that total working hours must not exceed 144 hours over a three-week period, subject to the applicable statutory framework.

For most private-sector employees, normal working hours are eight hours per day or 48 hours per week, although certain industries and employee categories may have different arrangements.

Employers must also provide appropriate rest breaks. Under the federal rules, employees generally cannot work for more than five consecutive hours without breaks totalling at least one hour. These breaks are not counted as working hours.

Overtime calculations should therefore consider both the additional wages payable and whether the working schedule complies with legal working-time limits.

How Is Overtime Calculated During Ramadan in the UAE?

During Ramadan, normal working hours for employees covered by federal UAE private-sector labour law are reduced by two hours per day.

For an employee whose normal working day is eight hours, this generally means a reduced working day of six hours during Ramadan.

Work performed beyond the applicable reduced working hours may qualify as overtime, subject to the employee's circumstances and the relevant legal provisions.

For example, if an eligible employee is scheduled to work six hours during Ramadan but works an additional two hours at the employer's request, those additional hours need to be assessed under the overtime rules.

Employers should adjust working schedules during Ramadan rather than continuing to treat an ordinary eight-hour schedule as unchanged.

Do DIFC and ADGM Employees Follow the Same Overtime Rules?

Employees working under the Dubai International Financial Centre (DIFC) or Abu Dhabi Global Market (ADGM) employment frameworks may be subject to different working-time and overtime requirements.

Both jurisdictions maintain their own employment regulations, which differ from the federal labour framework in certain areas.

For example, ADGM's Employment Regulations 2024 do not establish the same general statutory overtime premium structure as Article 19 of the federal Labour Law. Overtime entitlements can depend on the applicable regulations, employment contract, and company policies.

Employees working under DIFC employment arrangements should also refer to the applicable DIFC Employment Law and their contractual terms.

The standard UAE Overtime Calculator is therefore intended primarily for employees covered by federal private-sector labour law. Employees under separate employment jurisdictions should confirm which overtime rules apply before relying on an estimate.

Common UAE Overtime Calculation Mistakes

One of the most common overtime calculation mistakes is using an employee's gross salary instead of basic salary. Because housing, transportation and other allowances can represent a substantial portion of monthly earnings, this can produce incorrect overtime payments.

Another frequent error is treating all extra hours as ordinary overtime. An employee working additional hours between 10 PM and 4 AM may qualify for a higher rate, while work performed on a rest day or official public holiday has its own compensation requirements.

Employers can also make mistakes when attendance records do not distinguish between regular shifts and extra hours. This is particularly relevant for businesses with rotating shifts, multiple locations, or employees who regularly work outside standard office hours.

For accurate payroll processing, overtime calculations should be based on verified attendance records, the employee's salary structure, and the relevant employment rules.

Make Overtime and Payroll Processing Easier with PayDay

Calculating overtime for one employee is usually manageable. The challenge grows when a business needs to track additional working hours, rotating shifts, rest-day work and salary adjustments for an entire workforce.

PayDay Payroll Software UAE helps businesses connect attendance records with payroll calculations, reducing the need to transfer working-hour data between separate spreadsheets.

From tracking employee hours and managing overtime adjustments to processing monthly salaries and generating payroll reports, PayDay gives HR and finance teams a more organised way to manage payroll.