GUIDE · UPDATED SEPTEMBER 2026
UAE overtime rules — multipliers, caps and Ramadan
Overtime is where payroll quietly leaks money and compliance. Two multipliers, a daily cap, a holiday calendar that changes the rate, and a Ramadan reduction that catches people out every year.
- 1.25× normal day
- 1.5× rest day / holiday
- 2h daily cap
- Ramadan −2 hours
| Situation | Rate | Notes |
|---|---|---|
| Overtime on a normal working day | Basic + 25% (1.25×) | Calculated on basic wage, not gross |
| Overtime on a rest day or public holiday | Basic + 50% (1.5×) | Driven by the entity's holiday calendar |
| Daily cap | 2 hours | Statutory limit on overtime hours per day |
| Calendar basis | 30-day month | Used for the daily-rate divisor |
| Ramadan | Working day reduced by 2 hours | Applies to applicable employees |
| Rest-day work | Compensatory day off or the premium rate | Comp-off tracked as a balance |
Confirm the values applicable to your establishment and contracts with your labour counsel; eHRMS holds them in one reviewable statutory configuration.
Why manual overtime goes wrong
- The multiplier depends on the date, not the person. The same hour is 1.25× on Tuesday and 1.5× on Eid. Somebody has to check each date against the holiday calendar — every month, for every punch.
- Night shifts split across two dates. Hours worked after midnight belong to the next day, which may carry a different rate.
- Caps are enforced retrospectively or not at all. Discovering a breach at month end is too late to manage.
- Gross instead of basic. Overtime on the full package overpays systematically and is hard to unwind once it has been running.
- Ramadan handled by memory. Rebuilding shift templates each year, then rebuilding them back, is where errors enter.
The engine reads each punch, checks its date against the entity's calendar, applies the right multiplier and enforces the cap — see attendance & time tracking.
Not legal advice. The figures and rules on this page reflect the statutory references built into eHRMS at the time of writing, and are provided for general guidance. Entitlements change and individual contracts, free zones, DIFC and ADGM differ — always confirm current requirements with MOHRE, your free zone authority or your labour counsel.
FAQ
Overtime questions
See overtime calculated instead of typed
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