How overtime works in Australia

In Australia, overtime sits on two layers. The Fair Work Act 2009 (Cth) sets a national floor through the National Employment Standards (NES) — the minimum entitlements every employee in the national system gets, whatever their award or contract says. On top of that, most employees are covered by a Modern Award (there are over a hundred, one per industry or occupation) that sets the specific overtime and penalty rates for that kind of work.

That two-layer design is the single most important thing to understand: the NES fixes the baseline (for example, a 38-hour ordinary week), but the exact overtime multipliers, daily thresholds and weekend rates come from the applicable award or registered agreement. This guide covers the NES plus the common-award baseline — the pattern most awards follow. It does not reproduce any single award; always confirm the precise figures against the award that covers your team.

Overtime is time worked beyond ordinary hours. Ordinary hours are set two ways, and whichever is reached first triggers overtime:

So a full-time employee whose award sets 8 ordinary hours a day is on overtime once they pass 8 hours in a day or 38 hours in the week, whichever comes first. Weekend and public-holiday work is treated separately again — it attracts a penalty rate for the whole time worked, regardless of how many hours were done that day.

The common-award baseline escalates overtime through the day and applies flat penalties for weekends and public holidays. These are the rates most awards use — always the minimum you should apply, and sometimes exceeded by a specific award.

In A Tick records each of these as a distinct rate code, so every minute of a timesheet carries exactly one code and its multiplier:

Take a full-time employee on the common-award baseline (8 ordinary hours a day, 38 a week). Here is how a single week of timesheet entries buckets into rate codes:

Totalling the week by rate code:

Notice the weekly cap never fires here: the employee's ordinary weekday hours add up to 32 — under the 38-hour week — so all the overtime in this example comes from the daily thresholds and the Saturday penalty, not the weekly cap. Had those weekday ordinary hours crossed 38, the balance of the week would have moved to OT1 as weekly overtime.

Working through a week by hand is fine once. Across a whole team, every week, it is where payroll errors creep in. In A Tick models these rules once for your Australian region — the daily thresholds, the weekly cap, the weekend and public-holiday penalties — and its overtime calculation engine buckets every logged minute into the right rate code automatically. It is deterministic: the same timesheet always produces the same result, so pay is never left to guesswork or to AI.

Because the rules live in your region's configuration, a different award — or a different country entirely — is a different rule set, not a different spreadsheet. The calculation, the audit trail and the payroll-ready export all come out the same way.