Illinois Overtime Calculator Guide 2026: Worked Examples, Chicago Rates & Tipped Pay

How to calculate overtime pay in Illinois — step by step

Calculating overtime for non-exempt Illinois workers follows a clear five-step payroll process established under 820 ILCS 105/4a and federal Fair Labor Standards Act guidelines:

1. Step 1: Determine the Regular Rate of Pay:Calculate the employee's true regular hourly rate under 29 C.F.R. § 778.109 and Illinois administrative rules. The regular rate includes base hourly pay plus all non-discretionary bonuses, performance commissions, and shift differentials divided by all hours worked during the workweek. The regular rate cannot fall below the applicable statutory minimum wage ($15.00 statewide / $17.05 in Chicago).
2. Step 2: Audit Total Weekly Hours Worked:Sum all physical working hours in the employer's designated, fixed 7-day workweek. Hours physically worked beyond 40 are overtime hours. Paid non-working hours (such as PTO, vacation, or holiday pay) do not count toward the 40-hour overtime baseline.
3. Step 3: Calculate Straight-Time Wages:Multiply the first 40 hours worked by the regular hourly rate. For example, 40 hours at $22.00/hr yields $880.00 in straight-time earnings.
4. Step 4: Compute the Overtime Premium (1.5×):Multiply all hours worked beyond 40 by 1.5 times the regular rate. At $22.00/hr, the overtime rate is $33.00/hr ($22.00 × 1.5). Seven overtime hours produce $231.00 in overtime wages.
5. Step 5: Sum Gross Pay and Calculate Deductions:Add straight-time earnings and overtime wages to determine total gross compensation ($880.00 + $231.00 = $1,111.00). Deduct federal income tax, mandatory FICA payroll withholdings (6.2% Social Security + 1.45% Medicare), and the flat 4.95% Illinois state personal income tax.

Illinois overtime calculation examples

Below are five checked, step-by-step mathematical examples demonstrating how Illinois overtime calculations work across various employment situations, including standard hourly schedules, statewide minimum wage, tipped restaurant work, blended job rates, and salaried staff:

What is the regular rate of pay in Illinois?

Under the Illinois Minimum Wage Law (820 ILCS 105/4a) and federal regulations (29 C.F.R. § 778.109), the regular rate of pay is the weighted hourly rate used to calculate overtime compensation. It is determined by dividing total weekly earnings (less statutory exclusions) by the total number of hours worked during that workweek.

In Illinois, the regular rate cannot fall below the statutory minimum wage ($15.00 statewide / $17.05 in Chicago). Mandatory elements that must be included when calculating the regular rate:

• Base Hourly Pay: Standard straight-time compensation earned across all working hours.
• Non-Discretionary Bonuses: Attendance incentives, safety bonuses, productivity awards, and performance incentives announced in advance.
• Commissions: Direct sales commissions or transaction-based compensation earned during the workweek.
• Shift Differentials: Additional pay for second shift, third shift, weekend shifts, or hazardous duty.

Permitted statutory exclusions include discretionary holiday gifts, reimbursement for business expenses, paid leave where no work was performed (vacation, PTO, sick leave), and employer contributions to bona fide retirement and health plans.

Does Illinois have daily overtime?

No, Illinois does not have daily overtime. Under 820 ILCS 105/4a, Illinois enforces overtime on a weekly 40-hour basis only. Employers are not required to pay time-and-a-half after 8 or 10 hours in a single workday, nor does Illinois mandate double time after 12 hours. Unlike California, Colorado, Alaska, or Nevada, Illinois imposes no daily overtime thresholds.

Under Illinois law:

• An employee working a 12-hour or 14-hour shift receives straight-time pay for all 14 hours if their total hours for that workweek do not exceed 40.
• Illinois does not mandate premium pay for working on Saturdays, Sundays, or holidays unless those hours push total weekly hours past 40.
• Working seven consecutive days does not trigger premium pay under Illinois statutes, though it does trigger rest obligations under the One Day Rest in Seven Act.

For a comparison with daily overtime states and regional rules, review our national overtime pay calculator guide and our companion guide to New York overtime calculations.

Illinois overtime for tipped employees — the $16.50 trap

Under the Illinois Minimum Wage Law (820 ILCS 105/4), employers of tipped employees may take a tip credit of up to 40% of the statutory minimum wage. With Illinois's statewide minimum wage at $15.00 per hour, the maximum tip credit is $6.00 per hour, establishing a direct cash minimum wage of $9.00 per hour ($15.00 − $6.00).

The fundamental rule under 820 ILCS 105/4a and federal 29 C.F.R. § 778.207(b) is that overtime must be calculated on the FULL $15.00 minimum wage, not on the $9.00 cash wage:

Many Illinois restaurant and hospitality employers make the costly error of multiplying the $9.00 cash wage by 1.5 ($13.50/hr). This "tipped overtime trap" unlawfully underpays the worker by $3.00 per overtime hour ($16.50 − $13.50). Over a year of working 5 overtime hours per week, this wage theft totals $780.00 in unpaid overtime.

Illinois overtime for salaried employees

A common payroll fallacy is that paying an employee on a salary basis waives overtime eligibility. In Illinois, overtime exemption requires meeting both the salary-level threshold and the job duties test under federal FLSA regulations (29 C.F.R. Part 541), which Illinois enforces:

• The Salary-Level Test: The employee must receive a guaranteed salary of at least $684 per week ($35,568 per year).
• The Duties Test: The employee's primary job duties must involve executive management, administrative business operations involving independent judgment, or professional work requiring advanced specialized degrees. Job titles alone carry no legal weight.

Employees earning less than $684/week, or those whose job responsibilities do not satisfy the white-collar duties tests, are salaried non-exempt. When a salaried non-exempt worker exceeds 40 hours in a workweek, their regular hourly rate is Weekly Salary ÷ 40 hours, and all hours over 40 must be compensated at 1.5 times that rate.

Chicago and Cook County — the higher local rates

Illinois permits home-rule municipalities and counties to establish local minimum wage standards that exceed the statewide baseline:

• City of Chicago (Municipal Code Title 1-24): Effective July 1, 2026, the Chicago minimum wage is $17.05 per hour for employers with 4 or more workers. The minimum overtime rate in Chicago is $25.575 per hour ($17.05 × 1.5, ≈ $25.58 rounded). For tipped employees in Chicago, the tip credit is paused at 24% (phase-out paused on May 20, 2026 through June 30, 2028), setting the direct cash wage at $12.96 per hour.
• Suburban Cook County: Effective July 1, 2026, the Cook County minimum wage is $15.40 per hour, with a minimum overtime rate of $23.10 per hour ($15.40 × 1.5). The tipped cash wage is $9.25 per hour.
• Downstate & Balance of State: Governed by the statewide $15.00/hr minimum wage ($22.50/hr overtime rate).

Employers operating in Chicago or Cook County must calculate overtime using the higher applicable local wage floor.

One Day Rest in Seven — the rest day is not premium pay

The Illinois One Day Rest in Seven Act (ODRISA, 820 ILCS 140) provides vital workplace scheduling protections, but workers frequently confuse it with premium overtime pay:

• 24 Consecutive Hours of Rest: ODRISA mandates that employers provide covered employees at least 24 consecutive hours of rest in every calendar week (Sunday through Saturday). An employer who wishes to schedule an employee for 7 consecutive days must obtain an official permit from the Illinois Department of Labor (IDOL).
• Mandatory Meal Breaks: Employees working a shift of 7.5 hours or longer must receive an unpaid 20-minute meal break starting no later than the end of the 5th hour of work, plus an additional 20-minute break for each additional 4.5 continuous hours worked.
• No 7th-Day Premium Pay: Unlike California (where working a 7th consecutive day triggers time-and-a-half for the first 8 hours and double time thereafter), ODRISA does not create premium pay. If an employee works a 7th consecutive day in Illinois, those hours are paid at straight-time rates unless the total hours for that workweek exceed 40.

Illinois overtime pay biweekly — why the week still rules

While most Illinois employers issue paychecks biweekly (every two weeks), 820 ILCS 105/4a and federal 29 C.F.R. § 778.104 dictate that overtime is calculated strictly on a single 7-day workweek basis. An employer is legally prohibited from averaging hours across the two weeks of a biweekly payroll period.

Consider an employee who logs 48 hours in Week 1 and 32 hours in Week 2 (totaling 80 hours across two weeks):

• Week 1 (48 hours): The employee is owed 40 hours of straight-time pay plus 8 hours of overtime pay at 1.5×.
• Week 2 (32 hours): The employee is owed 32 hours of straight-time pay.
• Total Biweekly Pay: The worker must receive 72 straight-time hours plus 8 overtime hours. Averaging the two weeks together to claim that 80 hours equals an average of 40 hours per week violates Illinois Minimum Wage Law.

Illinois overtime and taxes — flat 4.95% state tax, and the §225 deduction

Unlike states with graduated brackets or zero income tax, Illinois levies a flat 4.95% personal income tax under 35 ILCS 5/201 on all net income:

• Flat 4.95% State Tax: Every dollar of overtime wages earned in Illinois—including the time-and-a-half premium—is taxed at exactly 4.95%. There are no progressive state brackets or higher surtaxes for overtime earnings.
• Federal Withholding & FICA: Overtime is subject to federal income tax withholding and standard FICA payroll taxes (6.2% Social Security + 1.45% Medicare). To learn why payroll systems withhold higher federal taxes on large overtime checks, read is overtime taxed more.
• Federal OBBBA § 225 Overtime Deduction (2025–2028): Under federal OBBBA § 225 rules, eligible employees can deduct the 0.5× FLSA overtime premium slice on federal Schedule 1-A (up to $12,500 single / $25,000 married joint). However, this federal deduction does NOT apply to Illinois state income tax. Illinois state tax remains 4.95% on all earnings. Estimate your net paycheck on our overtime tax calculator.