Overtime in China: Pay Rates, Calculation and Employer Rules

Last updated: November 2, 2026

Overtime pay in China depends on when the work occurs and which approved working-hour system applies. Under the standard working-hour system, work beyond the employee’s normal workday is generally paid at no less than 150% of the applicable hourly wage. Work on an arranged rest day is paid at no less than 200% if compensatory rest cannot be arranged.

Work on a statutory holiday is paid at no less than 300%, and compensatory time does not replace that premium. Employers must first classify the day, confirm the calculation base under the employment terms and applicable local wage-payment rules, apply the 21.75-day conversion method, and retain evidence supporting the hours and payment.

China overtime pay rates at a glance

These are minimum rates under Article 44 of the PRC Labor Law. An employment contract, policy, manager approval, or employee consent cannot reduce the statutory minimum. A contract or collective agreement may provide a more favorable entitlement.

What Is Overtime in China?

Overtime in China is employer-arranged work beyond normal working hours, on an arranged rest day, or on a statutory holiday, assessed under the applicable working-hour system. Articles 41 and 44 of the PRC Labor Law govern consultation, general limits and minimum premium pay; a time stamp alone does not establish compensable overtime.

See PRC Labor Law, Articles 41 and 44.

A rest day is not automatically Saturday or Sunday. A logistics site, factory, retail operation, or customer-support team may lawfully arrange rest days on other days. If Saturday is part of an employee’s normal adjusted schedule and the employee rests on Monday, Saturday work is not automatically rest-day overtime. The roster, employment terms, attendance records, and actual management practice should tell the same story.

Time spent voluntarily remaining at the workplace does not necessarily become overtime. However, a rule stating that “unapproved overtime will not be paid” may not protect an employer when a manager instructed the work, knew it was being performed, or accepted the output. Employers should investigate discrepancies instead of relying only on a missing approval form.

Standard working hours and overtime limits

Under the State Council Regulations on Working Hours of Employees, the standard system is generally eight hours per day and 40 hours per week. Employees must also receive statutory rest. The separate HROne guide to working hours in China explains standard, comprehensive, and non-fixed working-hour systems and their approval requirements in more detail.

Article 41 of the Labor Law generally requires consultation with the trade union and employees before extending working time. Overtime is ordinarily limited to one hour per day. Where special circumstances require an extension, it may reach three hours in a day if employee health is protected, but total overtime generally may not exceed 36 hours in a month.

Article 42 contains limited statutory exceptions, including urgent situations involving disasters, accidents, threats to life or property, and emergency repairs to production, transport, or public facilities. These exceptions should not be treated as a routine scheduling tool. An employee’s agreement to a long-hours arrangement does not make excessive overtime lawful; the Supreme People’s Court and the Ministry of Human Resources and Social Security have emphasized this point in their published overtime cases.

A routine “996” schedule is not made lawful by employee consent or payment of overtime premiums. Review the applicable working-hour rules and limits before setting recurring schedules.

How to determine the overtime calculation base

China has national overtime multipliers, but employers should not assume that one universal national definition determines the wage base in every location. The applicable base may be affected by the employment contract, a collective agreement, the employer’s wage structure, and local wage-payment rules or adjudication practice.

Start by identifying the employee’s wage for normal attendance and reviewing how the overtime calculation base is defined in valid employment documents. Then test that definition against the rules in the place of employment. A label such as “basic salary” does not automatically resolve the issue, especially if it excludes fixed components that function as normal wages. Conversely, reimbursements, one-off bonuses, and overtime already paid should not automatically be folded into the base.

Local rules may prescribe an order for determining the base, identify included or excluded components, and impose a minimum floor. For example, Shanghai’s official wage guidance discusses employment-contract and collective-agreement terms, normal-attendance wages, excluded items, and the local minimum-wage floor. That is a useful local example, not a rule that should be copied nationwide without checking the employee’s location.

Overtime Base Rules by City: Shanghai, Beijing, Shenzhen

Rules checked November 2, 2026. Consult the China minimum wage guide for the applicable local floor and effective date. Do not apply Shanghai’s fallback percentage nationwide or assume every city treats allowances alike.

The correct daily and hourly conversion formulas

A 2025 national wage-conversion notice reflects the increase to 13 statutory-holiday days. It changed average monthly system working days to 20.67, but monthly paid days remain 21.75. Employers should keep the two figures separate:

• 20.67 days represents average monthly system working days after excluding weekly rest days and statutory holidays.
• 21.75 days remains the divisor for converting monthly wage income into a daily wage.
• 174 hours, calculated as 21.75 days multiplied by eight hours, is the corresponding monthly hourly divisor.

Once the applicable monthly overtime base has been confirmed, the standard conversion is:

Daily wage base = applicable monthly overtime base ÷ 21.75

Hourly wage base = applicable monthly overtime base ÷ 21.75 ÷ 8

The overtime amounts can then be calculated as follows:

• Working-day overtime: hourly wage base × overtime hours × 150%
• Rest-day overtime without compensatory rest: hourly wage base × overtime hours × 200%
• Statutory-holiday overtime: hourly wage base × overtime hours × 300%

Do not use monthly salary divided by 30, and do not replace 21.75 with 20.67 in the wage-conversion formula. Payroll systems should retain sufficient decimal precision during the calculation and apply a consistent rounding rule to the final currency amount.

For a detailed explanation of why China uses 21.75 instead of 20.67, including daily pay, mid-month salary, and unpaid leave examples, see HROne’s China 21.75 salary divisor guide.

The current national basis is MOHRSS notice 人社部发〔2025〕2号, effective January 1, 2025, following the increase from 11 to 13 statutory-holiday days. It superseded the 2008 notice. Paid holidays remain in the wage-conversion calculation, so the 21.75 divisor did not fall to 20.67.

Worked China overtime pay calculation

Assume an employee under the standard working-hour system has a valid monthly overtime calculation base of RMB 10,000. During one payroll month, the employee performs two hours of working-day overtime, works eight hours on an arranged rest day for which no compensatory rest is provided, and works eight hours on a statutory holiday.

• Daily wage base: RMB 10,000 ÷ 21.75 = RMB 459.77
• Hourly wage base: RMB 10,000 ÷ 21.75 ÷ 8 = RMB 57.47
• Working-day overtime: RMB 57.471264 × 2 × 150% = RMB 172.41
• Rest-day overtime: RMB 57.471264 × 8 × 200% = RMB 919.54
• Statutory-holiday overtime: RMB 57.471264 × 8 × 300% = RMB 1,379.31

The total additional overtime pay is RMB 2,471.26. This simplified example assumes the RMB 10,000 base is valid under the employment terms and applicable local rules, each period has been correctly classified, and no special working-hour system changes the treatment. It does not mean that every component of an employee’s monthly cash compensation must always be included or excluded in the same way.

For broader monthly budgeting, use the China labor cost calculator. It estimates statutory employer costs; calculate overtime separately using the verified wage base, actual hours and applicable premium.

Estimate total employer cost

When compensatory time is permitted

Compensatory rest is not a universal substitute for overtime pay. Under the standard working-hour system, working-day overtime is generally paid at the 150% rate. For work on an arranged rest day, the employer may arrange actual compensatory rest; if it cannot do so, it must generally pay at least 200%.

Work on a statutory holiday is different. The employer must generally pay at least 300%, and a later day off does not replace the statutory-holiday premium. Any additional rest may be an extra benefit or a scheduling measure, but it does not cancel the payment obligation. For scheduling and entitlements beyond the calculation itself, see HROne’s guide to holiday pay in China.

Employers should document when rest-day work occurred, when compensatory rest was assigned, whether the employee actually took it, and how the adjustment appeared in attendance and payroll records. Local rules and collective arrangements may affect the permitted timing and administration of compensatory rest.

Comprehensive and non-fixed working-hour systems

A job title does not create an overtime exemption. Managers, executives, salespeople, drivers, and remote employees are not automatically outside the standard rules. The employer must assess whether a legally available alternative system applies and whether the required labor-authority approval has been obtained.

Under an approved comprehensive working-hour system, working time is measured across an approved cycle rather than only day by day. Hours exceeding the applicable standard across that cycle are generally compensated at no less than 150%, while statutory-holiday work generally remains subject to the 300% rate. Rest-day treatment cannot simply be copied from the standard system without reviewing the approval and applicable local rules.

An approved non-fixed working-hour system may change how ordinary working-day and rest-day overtime premiums apply. Statutory-holiday treatment and payroll practice can vary locally. Employers should review the approval document, covered positions, local implementation rules, and actual working arrangement before assuming that no overtime is due. Calling someone a “senior manager” in a contract is not a substitute for that analysis.

Review the approval scope and working-hour systems in China before choosing the payroll treatment.

Remote work, messages, travel, and after-hours evidence

Remote work does not eliminate overtime obligations, but neither does every after-hours message prove compensable work. Relevant questions include whether a manager required a response, whether the task was substantive, how long it took, whether the employer knew or should have known about recurring work, and whether the time can be established reliably.

Useful evidence may include schedules, attendance data, manager approvals, email and messaging timestamps, system-access logs, work-product records, and production records. No single item always decides the issue. A timestamp may show that an employee sent a message, but not that they worked continuously for several hours.

Ordinary commuting is generally different from working time. Business travel is fact-specific: simply being in transit is not automatically overtime, while driving at the employer’s direction, performing substantive duties during travel, or traveling within a required work schedule may require different treatment. Policies should explain how employees record travel, after-hours calls, emergency work, and cross-time-zone activity.

Payroll, individual income tax, and recordkeeping

Overtime calculation is a payroll control, not just an attendance task. Before payroll closes, HR, line management, and payroll should reconcile the employee’s working-hour system, assigned schedule, day classification, approved or otherwise evidenced hours, calculation base, multiplier, and compensatory-rest record. HROne’s China payroll guide explains the wider monthly payroll workflow.

Overtime pay is generally processed as wage and salary income through payroll and included in the employer’s individual income tax withholding process. Employers should not treat it as automatically tax-free or use a separate channel to avoid payroll controls. The payroll register and employee-facing wage record should support reconciliation.

Maintain a consistent audit trail covering schedules, attendance, overtime requests, manager decisions, system data, compensatory rest, calculation worksheets, payroll registers, payslips, and payment evidence. If the employer controls relevant attendance or payroll evidence and cannot produce it during a dispute, that can create significant evidentiary risk. Record-retention periods and document requirements should be checked against national and local rules.

Connect these controls with how to calculate payroll in China.

How Overtime Pay Is Taxed

Ordinary overtime compensation is employment remuneration, not an automatic tax exemption or a separate low-rate category. The tax authority’s overtime-allowance explanation applies the wages-and-salaries definition. For a resident individual, the STA withholding rules generally include it in cumulative wage income for withholding, after applicable deductions and prior withholding. Non-resident treatment differs; confirm the employee’s tax status.

A higher cumulative bracket can change withholding without changing the gross overtime entitlement. Reconcile the gross overtime, applicable deductions, IIT withheld, net payslip and bank payment; do not pay the overtime off payroll. Review China individual income tax for the wider rules.

For employers with their own China entity, a payroll provider can administer these calculations while the employing entity retains its legal duties. In a genuine EOR arrangement the local legal employer’s duties still apply; the business and employer should agree who supplies attendance, approves schedules and handles queries. Foreign headquarters’ policies need local review, and splitting systems or departments does not remove the obligation to document and pay overtime.

Common employer mistakes

• Treating every Saturday and Sunday as a rest day without checking the employee’s actual roster.
• Using monthly salary divided by 30, or using 20.67 instead of 21.75 for wage conversion.
• Assuming an employment contract can reduce the 150%, 200%, or 300% minimum rates.
• Giving compensatory leave for statutory-holiday work instead of paying the 300% premium.
• Assuming managers or remote employees are exempt without a valid approved working-hour arrangement.
• Relying solely on a preapproval policy when managers knowingly accept after-hours work.
• Using an untested “basic salary” figure without checking contractual and local wage-base rules.
• Allowing attendance, leave, compensatory-rest, and payroll systems to hold inconsistent data.
• Treating employee consent as permission to exceed statutory overtime limits.

Employer checklist for overtime pay in China

1. Confirm each employee’s working-hour system and any required approval.
2. Document the normal schedule and identify the employee’s actual rest days.
3. Classify overtime as working-day, rest-day, or statutory-holiday work.
4. Check the 36-hour monthly limit and whether any narrow statutory exception genuinely applies.
5. Validate the overtime calculation base against the contract, collective agreement, wage structure, and local rules.
6. Use the 21.75-day and 174-hour conversion method.
7. Apply the correct 150%, 200%, or 300% multiplier.
8. Track actual compensatory rest and never use it to replace statutory-holiday premium pay.
9. Reconcile attendance, approvals, calculations, IIT withholding, payroll, and payment evidence.
10. Periodically audit manager practices, remote work, travel, and system access against written policy as part of wider China HR compliance.

How HROne can support overtime payroll controls

For foreign companies employing staff in mainland China, HROne can help connect attendance inputs, local calculation rules, payroll review, individual income tax withholding, and employee records. Our payroll outsourcing in China service supports monthly payroll execution while the employer retains appropriate oversight of schedules, approvals, and employment decisions.

Frequently asked questions

What are the overtime pay rates in China?

Under the standard working-hour system, the statutory minimum is generally 150% for work beyond normal hours on a working day, 200% for rest-day work when compensatory rest cannot be arranged, and 300% for statutory-holiday work.

Is weekend work automatically paid at 200%?

No. The legal question is whether the employee worked on an arranged rest day, not whether the date was Saturday or Sunday. Employers may arrange rest days differently according to their lawful work schedules.

Can compensatory leave replace overtime pay?

It can generally replace the 200% payment for rest-day work if actual compensatory rest is arranged. It does not generally replace 150% working-day overtime pay or the 300% statutory-holiday premium under the standard system.

How is overtime calculated for a monthly salaried employee?

First determine the valid monthly overtime base under the employment terms and applicable local rules. Divide that base by 21.75 for the daily rate, then by eight for the hourly rate. Multiply the hourly rate by the verified overtime hours and the applicable 150%, 200%, or 300% rate.

Are managers and executives exempt from overtime pay?

Not automatically. A managerial title or contract clause does not itself create an exemption. The employer must assess the actual role, whether an approved comprehensive or non-fixed working-hour system applies, the scope of the approval, and relevant local rules.

Is Chinese overtime legal?

Overtime can be lawful when the employer follows the applicable working-hour system, consultation, health protections, limits and pay or qualifying rest requirements. Employee consent does not validate an excessive routine schedule. Article 42 has narrow exceptions; it is not a general exemption for busy periods.

What is the maximum overtime allowed in China?

Under the standard framework, Article 41 generally permits no more than one extra hour per day; special circumstances may allow up to three while protecting health, subject to the general 36-hour monthly cap. Article 42’s specific emergencies are separate. Paying the premium does not authorize routine work beyond the cap.