Overtime kicks in under Australian modern awards when an employee works beyond their ordinary hours — most commonly after 38 hours in a week, but many awards also trigger daily overtime once a shift passes a set length (typically 8, 10, or 12 hours), or when work falls outside the award’s ordinary span of hours. The exact threshold depends on the award and the employee’s classification, and where both a daily and a weekly trigger apply, overtime starts at whichever one is reached first. To apply the right threshold automatically on every shift, build the rules into award interpretation software.
Australian modern awards each define their own overtime thresholds — the point at which ordinary hours end and overtime rates begin. Getting these thresholds wrong leads to underpayment claims that can extend years into the past. The challenge is that different awards use different triggers: some have daily overtime (e.g., after 10 hours in a day), others have weekly overtime (after 38 hours), and many use both. This guide breaks down overtime thresholds for popular Australian modern awards including hospitality, retail, fast food, healthcare, and SCHADS, so you know exactly when overtime kicks in for your team and can keep your award interpretation and Fair Work compliance accurate.
Quick summary
- Weekly trigger:
Most awards trigger overtime after 38 ordinary hours per week
- Daily trigger:
Daily overtime thresholds vary — commonly 8, 10, or 12 hours depending on the award
- The rates:
Overtime is typically 150% (time-and-a-half) then 200% (double time) of the ordinary rate
- The catch:
Missing daily thresholds is one of the most common underpayment causes
How overtime thresholds work under Australian awards
Overtime under Australian modern awards is triggered when employees work beyond their ordinary hours. These thresholds are defined in each award and can include weekly triggers, daily triggers, or both:
Weekly thresholds
Hours exceeding 38 per week (or the agreed part-time hours) trigger weekly overtime. This applies regardless of how the hours are distributed across shifts.
Daily thresholds
Hours exceeding the daily maximum (often 8, 10, or 12 hours) trigger daily overtime. This applies even if the employee hasn’t reached 38 hours for the week.
When both daily and weekly thresholds apply, an employee might trigger overtime in multiple ways during a single pay period. The key is to apply whichever threshold is reached first for each day or pay cycle, and AI award interpretation can work out which threshold applies for you. A third trigger to watch for is work performed outside the award’s ordinary span of hours — for example, hours worked late at night or early in the morning that fall outside the span the award allows ordinary hours to be worked in. That work can attract overtime even when the employee is well under both the daily and weekly limits.
Overtime thresholds by modern award
The table below summarises the overtime thresholds for popular Australian modern awards. Treat it as indicative guidance only — awards contain detailed provisions, exceptions, and conditions that can change these figures for specific situations. For complete rate tables including base rates and penalty rates, see our award rate guides.
Indicative overtime thresholds and rates by modern award. Always confirm against the current award. Scroll horizontally on mobile.
| Award | Daily overtime threshold | Weekly threshold | Overtime rates |
|---|---|---|---|
| Hospitality (MA000009) | After 10 hr/day (excluding unpaid meal breaks) for full-time employees | After 38 ordinary hours, or agreed part-time hours | 150% first 2 hr, 200% after; Sunday 200% from hour one |
| General retail (MA000004) | After 9 hr/day (or 11 hr by agreement for 4-day weeks); casuals after 11 hr | After 38 ordinary hours, or agreed part-time hours | 150% first 3 hr, 200% after; Sunday 200% from hour one |
| Fast food (MA000003) | After 9 hr/day (excluding unpaid breaks); 10 hr for 4-day shift workers | After 38 ordinary hours for full-time employees | 150% first 2 hr, 200% after (Mon–Sat); Sunday 200% |
| Restaurant (MA000119) | After 10 hr/day (excluding unpaid breaks) for full-time employees | After 38 ordinary hours, averaged over a roster cycle where applicable | 150% first 2 hr, 200% after; Sunday 200% |
| SCHADS (MA000100) | After 10 hr/day (shift workers); after 8 hr (day workers). Broken-shift rules apply | After 38 ordinary hours, or agreed hours; may be averaged over a cycle | 150% first 2 hr, 200% after (Mon–Sat); Sunday 200%; public holiday 250% |
| Health professionals (MA000027) | After 10 hr/day (shift workers); after 8 hr (day workers) | After 38 ordinary hours, with averaging over roster cycles | 150% first 2 hr on any day, 200% after; Sunday 200% |
See our full award-rate guides for hospitality, general retail, SCHADS, and more for the exact clauses and penalty calculations.
Important
These summaries provide general guidance only. Awards contain detailed provisions, exceptions, and conditions that may affect overtime thresholds for specific situations. Always refer to the full award text or seek professional advice for your specific circumstances.
Daily overtime vs weekly overtime: what's the difference?
Understanding the difference between daily and weekly overtime is critical for correct pay calculations:
How daily and weekly overtime triggers compare.
| Aspect | Daily overtime | Weekly overtime |
|---|---|---|
| When it triggers | After exceeding daily hours threshold (e.g., 10 hours) | After exceeding 38 hours in a week |
| Assessment period | Each individual shift/day | Weekly pay period (or roster cycle) |
| Example trigger | Working an 11-hour shift (overtime from hour 11) | Working 45 hours Mon–Fri (overtime for 7 hours) |
| Common mistake | Not tracking hours within each shift | Only counting weekly hours, missing daily triggers |
Example: hospitality employee
Consider a full-time hospitality worker under the Hospitality Award (10-hour daily threshold, 38-hour weekly threshold):
- Monday: 8 hours (ordinary)
- Tuesday: 8 hours (ordinary)
- Wednesday: 12 hours (10 ordinary + 2 overtime)
- Thursday: 8 hours (ordinary)
- Friday: 6 hours (ordinary)
Total: 42 hours. The 2 hours on Wednesday after the 10-hour mark triggered daily overtime immediately — they didn’t need to wait until the employee reached 38 hours for the week. This is why tracking both thresholds is essential, and why working through an award compliance checklist before each pay run helps catch missed daily triggers.
How casual overtime is calculated
A common misconception is that casual employees don’t get overtime because they already receive casual loading. That’s wrong — casuals are entitled to overtime once they pass the relevant thresholds, and it can make casual overtime the most expensive labour on a roster. What varies between awards is how the overtime rate combines with the loading.
Worked example: casual overtime
Base hourly rate for the classification: $25.00
With 25% casual loading: $25.00 × 1.25 = $31.25 per hour (ordinary)
Where the award calculates overtime on the base rate plus loading, overtime at 150% is roughly $25.00 × 1.5 + loading, and some awards instead apply the penalty to the base rate before adding a separate loading. Because the method differs by award, always confirm the exact wording — a casual working an 11-hour shift can easily reach $45–$47 per hour once overtime and loading combine.
The safest approach is to configure the loading-and-overtime interaction once in a pay rate builder so the correct combined rate is applied to every casual shift automatically, rather than calculating it by hand each pay run.
Reasonable additional hours and time off in lieu
Overtime thresholds tell you when the higher rate applies — but two related rules govern whether the extra hours can be required at all, and how they can be compensated.
Reasonable additional hours. Under the National Employment Standards, an employer can only require an employee to work reasonable additional hours beyond 38 per week. What counts as “reasonable” depends on factors such as any risk to health and safety, the employee’s personal circumstances, the needs of the business, whether the employee was given enough notice, and the employee’s role. Employees can refuse overtime that is unreasonable, so long hours can’t simply be rostered on indefinitely — even where you’re willing to pay the overtime rate.
Time off in lieu (TOIL). Many awards let an employer and employee agree in writing to take paid time off instead of being paid the overtime rate. The time off is usually taken within a set window (often around six months), and if it isn’t taken in time, the employee must be paid out the overtime at the applicable overtime rate — not the ordinary rate. TOIL has to be agreed for each occasion (or under a standing agreement the award permits), and the arrangement must be recorded. Because TOIL still hinges on the overtime threshold being crossed, you need accurate hours tracking to know how much time in lieu has actually accrued.
Common overtime threshold mistakes
These overtime calculation errors cause underpayments:
Ignoring daily thresholds
Only calculating weekly overtime and missing daily triggers. An employee working 4 × 12-hour days (48 hours total) should receive daily overtime past the daily limit on each day, not just weekly overtime.
Wrong threshold for the award
Using 8-hour daily thresholds when the award specifies 10 hours, or vice versa. Each award has specific thresholds — assuming they’re all the same creates systematic errors.
Not counting casual hours
Assuming casuals don’t get overtime. Casual employees receive overtime when exceeding thresholds, calculated on their loaded rate. Missing this significantly underpays casuals on long shifts.
Incorrect break calculations
Including or excluding breaks incorrectly when calculating daily thresholds. Most awards exclude unpaid meal breaks from the calculation, but paid rest breaks usually count toward hours worked.
For a deeper look at where these errors originate — and the backpay they can cause — see our guides on award interpretation mistakes and how meal break and overtime entitlements differ by award.
How award interpretation software handles overtime
Modern award interpretation software automatically tracks overtime thresholds so you don’t have to work them out shift by shift:
Award-specific rules
Built-in thresholds for each modern award. Select the relevant award, and the system applies correct daily and weekly overtime triggers automatically.
Real-time tracking
As employees clock in and out, the system tracks hours against both daily and weekly thresholds. Overtime triggers automatically when thresholds are exceeded.
Correct rate application
Applies 150% for initial overtime hours and 200% for subsequent hours based on award rules. Handles casual loading calculations correctly.
Cost forecasting
See projected overtime costs before publishing rosters. Understand how shift lengths affect labour costs including overtime premiums.
Payroll integration
Compliance alerts
Warns when rostered shifts will trigger overtime, helping managers make informed decisions about scheduling and labour costs.
Related RosterElf features
Automatic overtime calculations under Australian awards. RosterElf tracks daily and weekly overtime thresholds automatically, applies the right 150% / 200% rates, and exports clean data to Xero and MYOB — so you never miss an overtime trigger or underpay employees.
Disclaimer
This article provides general guidance only and does not constitute legal advice. Award provisions and overtime thresholds are subject to change. Always verify current requirements using official Fair Work Ombudsman resources and seek professional legal advice for your specific circumstances.
Frequently asked questions
When does overtime start under Australian modern awards?
Overtime thresholds vary by award. Most awards trigger overtime after 38 ordinary hours per week, but many also have daily thresholds (commonly after 8, 10, or 12 hours per day), and some trigger it for work outside the award’s ordinary span of hours. Where more than one trigger applies, overtime starts at whichever is reached first. Check our award rate guides for exact thresholds.
What is the difference between daily and weekly overtime?
Daily overtime triggers when an employee exceeds hours in a single day (e.g., after 10 hours). Weekly overtime triggers when total hours exceed the weekly threshold (typically 38 hours). Many awards use both — an employee could trigger daily overtime on a long shift even if they haven’t reached 38 hours for the week.
Does the Hospitality Award have daily overtime?
Yes, the Hospitality Industry General Award (MA000009) has both daily and weekly overtime thresholds. Full-time employees trigger overtime after 10 hours in a day (excluding unpaid breaks). Weekly overtime applies after 38 ordinary hours. Part-time employees may have different arrangements based on their agreed hours.
What are the overtime rates under Australian awards?
Most awards pay overtime at 150% (time and a half) for the first 2–3 overtime hours, then 200% (double time) thereafter. Some awards have different structures — for example, overtime on Sundays may already be at double time. The specific rates depend on your modern award and when the overtime hours are worked.
Do casual employees get overtime?
Yes, casual employees are entitled to overtime when they exceed the relevant thresholds, on top of their casual loading. Depending on the award, overtime may be calculated on the base rate plus loading or on the base rate with a separate loading added. Either way, casual overtime is significantly more expensive, so a pay rate builder is the safest way to apply the correct combined rate.
How does the SCHADS Award handle overtime?
The SCHADS Award (MA000100) has specific overtime provisions for disability and community services. Daily overtime generally applies after 10 hours for shift workers (or 8 hours for day workers), with rates of 150% then 200%, and 250% for public holiday overtime. The award also has complex provisions for broken shifts and sleepover work that interact with overtime calculations.
Can an employee refuse to work overtime?
Yes. Under the National Employment Standards, an employer can only require reasonable additional hours beyond 38 per week, and an employee can refuse overtime that is unreasonable. Whether hours are reasonable depends on factors such as health and safety, the notice given, the employee’s personal circumstances, and business needs — so long hours can’t simply be rostered on indefinitely, even at the overtime rate. Using rostering software that flags overtime before you publish helps keep additional hours reasonable.
Can overtime be paid as time off in lieu instead of money?
Many awards allow an employer and employee to agree in writing to take paid time off in lieu (TOIL) rather than being paid the overtime rate. The time off is usually taken within a set window (often around six months), and if it isn’t taken, the overtime must be paid out at the applicable overtime rate — not the ordinary rate. Because TOIL still depends on the overtime threshold being crossed, accurate time and attendance records are essential to track how much has accrued.
