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Line or operator efficiency — SMV, minutes produced and worked.
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Overtime Cost Calculator — Total OT Cost Per Piece and Per Order
Calculate total overtime cost for a production line including per-piece cost and order-level impact. Supports double-rate Bangladesh Labour Law OT calculation. Free tool for garment factory IE and production managers. No account needed — numbers update as you type.
Step By Step
How to Use This Calculator
5 steps
- Enter the number of operators on the line and their basic monthly salary.
- Set working days per month and regular shift hours per day.
- Enter overtime hours per day and the OT rate multiplier (2× under Bangladesh Labour Law).
- Optionally enter SAM and efficiency to calculate the overtime cost per piece produced.
- Results show hourly rate, OT pay per operator, total line OT cost, and cost per piece.
Worked Example
Worked example — 25 operators, BDT 12,500 basic salary, 2 hours OT/day
Use this sample to sanity-check your inputs and understand what the final result represents.
- 1Basic salary: BDT 12,500/month | Working days: 26 | Shift: 8 hours
- 2Hourly rate: 12,500 ÷ (26 × 8) = BDT 60.10/hr
- 3OT rate at 2×: BDT 120.19/hr | OT hours: 2
- 4OT per operator per day: 120.19 × 2 = BDT 240.38
Final Result
Total line OT cost: 240.38 × 25 = BDT 6,009/day. Monthly OT cost: BDT 1,56,240.
Methodology
Overtime Cost Formula — Bangladesh Labour Law
This section explains the calculation logic, assumptions, and source material used to make the result more trustworthy and easier to verify.
Hourly Rate = Basic Salary ÷ (Working Days × Shift Hours). OT Rate per Hour = Hourly Rate × OT Multiplier (2× under BLL). Total OT Cost = OT Rate × OT Hours × Operators. OT Cost per Piece = Total OT Cost ÷ OT Pieces Produced. OT Pieces = (Operators × OT Minutes × Efficiency) ÷ SAM.
Practical Guidance
Managing overtime cost in RMG factories
- 1The cost of producing a piece during overtime is almost always higher than the regular cost — at 2× OT rate and typical 65% efficiency, OT cost per piece can be 20–35% more than regular production cost
- 2Before authorising OT, compare the OT cost against the penalty clause in the buyer's contract for late delivery — sometimes it is cheaper to take a small penalty than to run expensive OT
- 3Under Bangladesh Labour Act 2006, workers cannot legally work more than 2 hours of overtime per day or 12 hours per week — exceeding this creates compliance risk for factory BSCI and audit certifications
- 4Track OT days per worker monthly and flag anyone approaching the legal monthly limit — auditors from European buyers specifically check OT records against attendance sheets
Frequently Asked Questions
What is the legal overtime rate in Bangladesh?+
Under the Bangladesh Labour Act 2006 (Section 108), overtime must be paid at twice the basic wage rate. The formula is: OT pay = (Basic Salary ÷ 208) × 2 × OT hours, where 208 is the standard monthly working hours (8 hours × 26 days). Note that the OT rate applies to basic salary only — house rent, medical and other allowances are not included in the OT base. The maximum legal overtime is 2 hours per day and 12 hours per week.
How does overtime affect per-piece CM cost?+
CM cost is directly proportional to the total operator-minutes paid. When operators work OT at 2× rate, every OT minute costs twice as much as a regular minute. If a factory runs 2 hours of OT daily (25% of an 8-hour shift) with 100% of those OT minutes at 2× rate, the blended CM cost increases by approximately 25% × (2−1) = 25% premium on the OT portion — which typically translates to 5–10% increase in total CM cost depending on efficiency and OT volume.
Is overtime always bad for cost?+
Not always. OT is rational when the buyer penalty for late delivery exceeds the OT premium, or when you need a short burst to clear a bottleneck before a ship date. The problem is habitual OT used to cover poor capacity planning — that pattern almost always costs more than hiring or rebalancing lines would have.
Can overtime cost more than air freight?+
On small urgent orders, yes. Running 25 operators for 2 hours of daily OT on a 5,000-piece order can add BDT 150,000+ in labour premium. Air freight for that same order might be BDT 80,000–120,000 depending on destination. Always compare OT cost against logistics alternatives before authorising extended OT.
How many overtime hours are allowed per day in Bangladesh?+
The Labour Act caps overtime at 2 hours per day and 12 hours per week for adult workers. Exceeding this creates compliance risk during BSCI, WRAP, or buyer social audits. Auditors cross-check attendance registers, payroll OT lines, and gate pass records — discrepancies are a common finding.