It’s audit week at a garment unit in Tiruppur. The inspector asks a simple question: “Show me the overtime records for the last three months.”
The HR manager opens a folder of loose sheets. Some supervisors wrote extra hours on paper. Some sent them on WhatsApp. A few workers say they stayed late but were never paid for it. Nobody can say for sure who worked how many hours.
This isn’t a rare situation. In many Indian businesses, working hours and overtime are the least tracked part of attendance. Yet they’re the part that affects salaries, legal compliance, employee health and costs the most.
This guide explains, in simple words, what HR teams should track when it comes to working hours and overtime, what the new labor codes expect, and how to set up a system that keeps everyone fairly paid and protected.
Short answer: HR teams should track each employee’s daily start and end time, total hours worked, breaks, weekly hours, overtime hours, overtime approval and consent, overtime pay, and weekly rest days. Under India’s labor codes, normal hours are capped at 8 a day and 48 a week, overtime is paid at twice the ordinary wage rate, and overtime hours have a quarterly limit. Accurate digital records make this easy to manage and prove.
Why Working Hours and Overtime Matter
Working hours aren’t just a number on a payslip. They affect four big things:
- Fair pay. If someone works extra hours, they should be paid for them, correctly and on time.
- Legal compliance. Labor laws set limits on working hours and overtime and require employers to keep records.
- Employee health. Long hours, week after week, lead to tiredness, mistakes, accidents, and people quitting.
- Business costs. Unplanned overtime quietly increases salary costs. Without tracking, you won’t even notice.
When working hours are tracked properly, all four improve at the same time.
Before vs. Now: How Tracking Working Hours Changes
Here’s what changes when an HR team moves from loose, manual tracking to a proper system.
| What you look at | Before (paper, WhatsApp, memory) | Now (digital attendance and clear rules) |
|---|---|---|
| Start and end time | Written by hand or not recorded at all | Exact time saved at every check-in and check-out |
| Daily hours worked | Guessed from shift timing | Calculated automatically for each person |
| Overtime | Noted by supervisors, often forgotten | Counted automatically beyond set hours |
| Overtime approval | Verbal “stay back today” | Requested and approved in the system |
| Employee consent | Rarely recorded | Recorded with each overtime approval |
| Overtime pay | Calculated by hand, often wrong | Based on exact hours, ready for payroll |
| Weekly hours limit | Nobody checks | Alerts when someone is close to the limit |
| Weekly rest day | Sometimes skipped in busy weeks | Tracked for every employee |
| Audit or inspection | Panic and missing papers | Reports ready to download in minutes |
| Burnout warning signs | Noticed only when someone quits | Visible in monthly overtime reports |
The difference isn’t only speed. It’s that HR can finally answer any question about working hours with confidence.
What the Labor Codes Say About Working Hours
India’s four labour codes came into force on 21 November 2025. The Occupational Safety, Health, and Working Conditions Code (OSH Code) and the Code on Wages set the main rules for working hours and overtime. Here are the basics HR teams should know:
- Daily limit: normal working hours are capped at 8 hours a day.
- Weekly limit: normal working hours are capped at 48 hours a week.
- Spread-over: the total time from the start to the end of a workday, including breaks, has an upper limit, commonly up to 12 hours where hours are compressed into fewer days.
- Overtime rate: any overtime must be paid at twice the ordinary rate of wages.
- Overtime cap: the central rules set a limit of 144 overtime hours per quarter.
- Consent: Overtime is meant to be voluntary, so employers should record the worker’s consent.
- Weekly rest: employees are entitled to a weekly day of rest.
- Records: employers must keep registers of attendance, working hours, overtime, and wages.
States can set their own rules under these codes, and many state shop and establishment rules still apply to offices and shops. If your business works across states, follow whichever rule is stricter for each location. Check the exact limits for your state and industry with your CA or labor law consultant.
This section is general information, not legal advice.
What HR Teams Should Track: The Complete Checklist
Here’s everything worth tracking, grouped so it’s easy to set up.
1. Daily Start and End Time
The foundation of everything else. Record the exact time each employee starts and finishes work, using a biometric device, QR code, mobile app or web check-in. Handwritten times are easy to change and hard to trust.
2. Total Hours Worked Each Day
Hours worked is the time between check-in and check-out, minus unpaid breaks. This number tells you whether someone worked a full day, a short day or extra time.
3. Breaks
Track lunch and rest breaks, especially in factories and shift work. Rules require rest intervals during long stretches of work, and breaks also affect how total hours are counted.
4. Weekly Hours
Daily hours can look fine while weekly hours quietly cross the limit. Add up hours across the week for each person, especially in busy seasons.
5. Overtime Hours
Overtime is time worked beyond normal daily or weekly hours. Track it separately from regular hours, because it’s paid at a higher rate and has legal limits.
6. Overtime Approval
Overtime should be requested and approved in advance, not discovered at month-end. Record who asked for it, who approved it and why.
7. Employee Consent
Since overtime is meant to be voluntary, keep a simple record that the employee agreed to it. A tap of “accept” in an app is enough.
8. Quarterly Overtime Totals
Keep a running total for each person across the quarter so nobody crosses the overtime limit without HR noticing.
9. Weekly Rest Days
Make sure every employee gets their weekly rest day. If someone works on their off day, record it and give a substitute rest day as your policy and the rules require.
10. Night Shifts
Track who works night shifts, how often, and any special conditions your state rules set, especially for women employees, such as consent and safety arrangements.
11. Late Arrivals and Early Exits
These reduce actual working hours and often explain why someone falls short of a full day.
12. Leave and Holidays
Paid leave and holidays affect total hours and payable days. Keep them in the same system so hours and leave always match. Our guides on leave and holiday management explain how to set this up properly.
How to Set Up Working Hours and Overtime Tracking
Here’s a practical step-by-step plan.
Step 1: Write a Clear Working Hours Policy
Put these on one page:
- Normal daily and weekly hours for each team or shift
- Break timings
- Weekly off days
- What counts as overtime
- How overtime is requested and approved
- How overtime is paid
- Who to contact with questions
Step 2: Set Up Shifts in Your Attendance System
Enter each shift’s start time, end time, and break. If you run morning, evening, and night shifts, set them up separately.
Step 3: Define Overtime Rules
Tell the system when overtime begins, for example after 8 hours in a day or 48 in a week, and whether small amounts, such as 10 or 15 minutes, should be ignored.
Step 4: Add an Approval Step
Set up overtime requests so a manager approves them before or on the same day, with the employee’s consent recorded.
Step 5: Turn On Alerts
Set alerts for when someone is close to the weekly hours limit or the quarterly overtime cap. This lets HR act before a limit is crossed, not after.
Step 6: Connect to Payroll
Let approved overtime flow directly into salary calculation so it’s paid correctly and on time. Read more in our guides on payroll and working hours.
Step 7: Review Reports Every Month
Look at hours and overtime by team and by person every month, not only during audits.
Reports Every HR Team Should Check Monthly
These five reports cover most of what you need:
- Hours worked report: total hours for each employee for the month.
- Overtime report: overtime hours by person and team, with approval status.
- Quarterly overtime tracker: running totals against the quarterly limit.
- Weekly rest report: anyone who missed their weekly off.
- Late arrival and early exit report: patterns that reduce working hours.
Keep these reports safely. If an inspector or auditor asks for records, you’ll have them ready in minutes.
Reading the Signs: When Overtime Is a Warning
Overtime numbers tell a story if you look closely.
The same people, every month. If a few employees always have high overtime, they may be carrying too much work, or the team may be short-staffed. This often ends in burnout or resignations.
One team stands out. If one department always works late, look at workload, planning, or staffing before blaming the people.
Overtime rises every month. A steady increase usually means demand has grown and it’s time to hire, not to stretch the current team further.
Overtime without approval. If people regularly stay late without approval, they may feel pressure to do so, or work may not be planned well.
Weekly offs being skipped. Missing rest days is both a health risk and a compliance risk.
Long hours rarely lead to better results for long. For ideas on keeping teams productive without overloading them, explore our guides on employee productivity.
Special Cases HR Teams Often Miss
Some situations don’t fit neatly into a normal shift. Plan for these in advance.
Field and Sales Staff
People on the road often start early and finish late, but nobody sees it. Use a mobile app with check-in and check-out, so their real hours are recorded instead of assumed.
Work From Home Employees
Remote staff may work late in the evening without anyone noticing. Ask them to check in and out on an app, and make sure extra hours go through the same approval process as office overtime.
Contract and Temporary Workers
Workers hired through contractors often work the longest hours. Track their hours in the same system, so overtime is visible and paid correctly, whether by you or the contractor.
Managers and Supervisors
Overtime rules under the labour codes mainly protect workers. People in managerial or supervisory roles may be treated differently depending on their role and salary. Check with your labour law consultant before deciding who is covered.
Compressed Work Weeks
Some businesses try four longer days instead of six shorter ones. This can be allowed, as long as weekly hours, spread-over and rest rules are followed. Track hours carefully, because long days quickly push people into overtime.
Festive and Peak Seasons
Retail, e-commerce and manufacturing often see big overtime spikes before Diwali or year-end. This is exactly when the quarterly overtime cap and weekly rest days are most at risk. Plan extra staff or temporary workers early, instead of stretching the same team.
Common Mistakes HR Teams Make
- Not recording exact times. Without real check-in and check-out times, hours and overtime are guesses.
- Approving overtime after the fact. Month-end surprises lead to disputes and budget shocks.
- Forgetting consent. Overtime should be voluntary, and you should be able to show it.
- Only checking daily hours. Weekly hours can cross the limit even when each day looks normal.
- Ignoring the quarterly cap. Busy seasons can push people over without anyone noticing.
- Paying overtime at the wrong rate. Overtime is paid at twice the ordinary wage rate, not the normal rate.
- Skipping weekly rest in peak seasons. It’s tempting, but it’s risky for both health and compliance.
- Keeping records on paper or chat. They get lost exactly when you need them.
How an Attendance System Helps
Tracking all of this by hand is slow and error-prone. A digital attendance system does most of the work for you:
- Records exact check-in and check-out times
- Calculates daily and weekly hours automatically
- Marks overtime based on your rules
- Handles overtime requests, approvals and consent
- Alerts HR when someone nears a limit
- Tracks weekly offs, leave and holidays
- Sends approved overtime to payroll
- Creates audit-ready reports in minutes
For HR, it means fewer spreadsheets, fewer disputes and much less stress during audits.
Final Thoughts
Go back to the garment unit from the start, with its folder of loose sheets during audit week. With proper tracking, that same HR manager could have downloaded three months of working hours, approved overtime and consent records in a few clicks, and every worker who stayed late would have been paid correctly.
That’s what good working hours tracking gives you. It protects employees from overwork, protects the business from compliance risk, keeps salary costs under control and builds trust that extra effort is always paid for. Start with a clear policy, record exact times, make overtime a planned and approved process, and check your reports every month, not just when an inspector visits.
Track Working Hours and Overtime with Attendi
Attendi is a simple attendance management system built for Indian businesses. It records exact working hours through biometric and QR code attendance, manages leave and holidays, and tracks working hours and overtime for payroll, with clear reports in one place. If your working hours and overtime still live on paper or in chat messages, Attendi helps you keep accurate, audit-ready records without the extra effort. Explore more guides on our website or get in touch through our contact page.
Frequently Asked Questions
What are the working hour limits in India under the new labour codes?
Normal working hours are capped at 8 hours a day and 48 hours a week. Work beyond these limits counts as overtime. States may set their own detailed rules, so check the requirements for your location.
How is overtime paid in India?
Under the labour codes, overtime must be paid at twice the ordinary rate of wages for the extra hours worked.
Is there a limit on overtime hours?
Yes. The central rules under the OSH Code set a cap of 144 overtime hours per quarter. State rules may differ, so confirm the limit that applies to your business.
Can employers make overtime compulsory?
Overtime is meant to be voluntary under the new rules, so employers should record the employee’s consent for overtime work.
How can HR track overtime for field and remote staff?
Use a mobile app or web portal for check-in and check-out, so real start and end times are recorded. Send any extra hours through the same request and approval process used for office staff.
What records should HR keep for working hours and overtime?
Daily start and end times, total hours worked, breaks, overtime hours, overtime approvals and consent, overtime pay, weekly rest days, and leave and holidays. These should be kept safely and be easy to produce during an audit or inspection.
