Time Card Calculator Guide: How to Calculate Hours & Overtime

What Is a Time Card?

A time card — also called a timesheet — is a record of the hours an employee works each day during a pay period. Employers use time cards to calculate gross pay for hourly and non-exempt salaried workers, verify that overtime rules are followed, and comply with federal and state recordkeeping requirements.

Time cards can be paper-based punch cards, digital timesheets, or entries logged in payroll software. The format doesn't matter as long as the data captures: the date, time in, time out, break duration, and total hours worked per day.

According to the Bureau of Labor Statistics National Compensation Survey 2024, approximately 58% of private-sector workersare paid on an hourly basis — meaning accurate time card tracking directly determines their take-home pay every pay period.

How to Calculate Hours from a Time Card

The standard method is to convert all times to decimal hours, subtract unpaid break time, and sum across the week.

Step 1: Convert to Decimal Hours

Clock times use minutes out of 60, but payroll math uses decimals. Divide minutes by 60 to convert. For example:

• 8:30 AM = 8 + (30 ÷ 60) = 8.50
• 5:15 PM = 17 + (15 ÷ 60) = 17.25
• Hours worked = 17.25 − 8.50 = 8.75 hours

Step 2: Subtract Unpaid Break Time

If the employee takes a 30-minute unpaid lunch, subtract 0.50 from the total: 8.75 − 0.50 = 8.25 hours for that day.

Step 3: Sum the Week

Add each day's hours. If the weekly total exceeds 40 (or 8 per day in California), overtime rules apply.

Decimal Time Conversion Table

This reference table converts common minute values to their decimal equivalents. Use it to read any time card without mental math.

FLSA Overtime Rules

The Fair Labor Standards Act (FLSA), enforced by the U.S. Department of Labor, is the federal law that governs overtime pay for most workers in the United States.

Under the FLSA, non-exempt employees must be paid 1.5× their regular rate for all hours worked beyond 40 in a single workweek. A workweek is any fixed, regularly recurring period of 168 consecutive hours (7 days). It does not need to align with a calendar week.

Who Is Non-Exempt?

Most hourly workers are non-exempt by default. Salaried employees can also be non-exempt if they earn below the DOL's salary threshold, which was set at $684 per week ($35,568 annually)as of 2020, with updates proposed in subsequent years. When in doubt, consult the DOL's FLSA guidelines.

The Overtime Formula

The standard weekly pay calculation for an hourly employee is:

Weekly Pay = (Regular Hours × Hourly Rate) + (Overtime Hours × Hourly Rate × 1.5)

Example: An employee works 46 hours at $18/hour:

• Regular pay: 40 × $18 = $720.00
• Overtime pay: 6 × ($18 × 1.5) = 6 × $27 = $162.00
• Total gross pay: $720 + $162 = $882.00

State Overtime Rules: California and Beyond

Several states go further than the federal FLSA minimum. California has the most employee-favorable overtime rules in the country under the California Labor Code.

If you work in California, daily hours matter just as much as weekly totals. A California employee who works 8.5 hours on Monday through Friday (42.5 hours total) owes overtime even if the weekly total were under 40 — because each day exceeds 8 hours.

Bi-Weekly vs Semi-Monthly Pay: What's the Difference?

Pay frequency affects how time card hours are grouped and how overtime is calculated.

Bi-weekly is the most common pay schedule for hourly workers because each pay period spans exactly two 7-day workweeks — making overtime calculations clean. Semi-monthly pay periods can span parts of three different workweeks, which complicates FLSA overtime calculations and requires careful tracking.

DOL Time Rounding Rules

The Department of Labor allows employers to round recorded times to the nearest 5 minutes, nearest one-tenth of an hour (6 minutes), or nearest quarter hour (15 minutes) — as long as the rounding policy is neutral over time and does not systematically short-change employees.

In practice, the 15-minute rounding rule is most common. Under this rule:

• Times from :01 to :07 round down to the hour
• Times from :08 to :22 round to :15
• Times from :23 to :37 round to :30
• Times from :38 to :52 round to :45
• Times from :53 to :59 round up to the next hour

Employers who always round down, or who round only when it benefits the company, are violating FLSA. Courts have found employers liable for back wages when rounding was not applied neutrally.

Employer Recordkeeping Requirements

Under the FLSA, employers must maintain payroll records — including time cards, work schedules, and wage calculations — for a minimum of 2 years. Basic employment records (name, address, job title, hours per day, wages paid) must be kept for 3 years.

These records must be available for inspection by the Department of Labor at any time. Employers who fail to maintain adequate records face civil penalties and can be held liable for back wages if an employee files a complaint.

5 Common Payroll Errors That Cost Employees Money

1. Misclassifying Employees as Exempt

Labeling a worker as “salaried” or “manager” does not automatically make them exempt from overtime. FLSA exemptions depend on salary level AND job duties. Misclassification is one of the most common wage violations and can result in years of unpaid overtime.

2. Not Counting All Hours Worked

Time spent answering emails after hours, attending mandatory pre-shift meetings, or waiting for equipment at the worksite is compensable time. Employers who ignore these “off the clock” minutes violate FLSA. According to the Economic Policy Institute, wage theft through unpaid work time costs U.S. workers an estimated $15 billion per year.

3. Rounding That Systematically Favors the Employer

As covered above, rounding is only legal when it's neutral. Employers who always round employee clock-in times forward (reducing paid time) and clock-out times backward are stealing wages — even if each individual rounding seems trivial.

4. Incorrect Overtime Base Rate

Overtime must be calculated on the employee's regular rate of pay, which includes non-discretionary bonuses, shift differentials, and commissions — not just base hourly wages. Calculating overtime on base wages alone when a production bonus was also paid understates the correct overtime rate.

5. Forgetting State Daily Overtime Rules

Employers operating in California, Nevada, or Alaska who only track weekly totals will miss daily overtime obligations. A California worker who clocks 8 hours and 15 minutes every day for five days is owed 1.25 hours of daily overtime — even though the weekly total of 41.25 hours barely crosses the federal threshold.

Related Payroll Guides

Time cards are just one piece of the payroll picture. These guides cover the next steps:

• How overtime pay is calculated — formula, examples, and state rules
• How to read your paycheck — gross vs net pay, deductions, tax withholding
• Salary to hourly conversion — convert an annual salary to an effective hourly rate
• Payroll taxes explained — Social Security, Medicare, federal and state withholding
• Hourly wage to annual salary — what your hourly rate means as a yearly figure

Frequently Asked Questions

How do you calculate hours worked from a time card?

Convert your start and end times to decimal hours, subtract break time, then sum each day. For example, 8:30 AM to 5:15 PM equals 8.75 hours. Subtract a 0.5-hour lunch break and you get 8.25 hours for that day. Add each day's total to get your weekly hours. Our Time Card Calculator handles this automatically.

How is overtime calculated?

Under the federal FLSA, overtime applies to all hours over 40 in a workweek for non-exempt employees, paid at 1.5 times the regular rate. California also requires daily overtime for hours over 8 in a single day and double time for hours over 12. Weekly pay = (regular hours × rate) + (overtime hours × rate × 1.5). See our overtime pay guide for more examples.

What is the difference between bi-weekly and semi-monthly pay?

Bi-weekly pay means you receive a paycheck every two weeks — 26 pay periods per year. Semi-monthly pay means twice per month on fixed dates (e.g., the 1st and 15th) — 24 pay periods per year. Bi-weekly is more common for hourly workers because it aligns naturally with a 7-day workweek, keeping overtime calculations clean.

How do employers calculate break time?

The DOL requires that rest breaks of 20 minutes or less must be paid. Meal breaks of 30 minutes or more are typically unpaid, but only if the employee is completely relieved of duties. Employers subtract unpaid meal break time from total hours worked when calculating pay. If a worker is interrupted during a meal break and asked to perform work, that break time becomes compensable.

How long must employers keep time records?

Under the FLSA, employers must keep payroll records — including time cards and schedules — for at least 2 years. Basic employment records (name, hours, wages) must be kept for 3 years. These records must be available for inspection by the Department of Labor at any time. Some states set longer retention requirements, so check your state's labor code as well.