To calculate military time for payroll, subtract the clock-in from the clock-out to get hours and minutes, convert the minutes to a decimal by dividing by 60, subtract any unpaid meal break, multiply the decimal hours by the hourly rate, and pay 1.5 times the rate for any hours over 40 in the workweek. The 24-hour clock removes the AM/PM guesswork; the rest is arithmetic done carefully.
Reading the Timestamps
A military timestamp has four digits. The first two are the hour, the last two are the minutes. Midnight is 0000 and the clock counts up through 2359. Morning times look familiar: 0730 is 7:30 AM. After noon, the hour keeps climbing instead of resetting, so 1:00 PM is 1300 and 5:15 PM is 1715. To convert any PM time to military, add 12 to the hour.
Every minute of the day has one unique number, which is the whole point for payroll. A clerk working through a stack of timecards never has to decide which “8:00” the employee meant.
Subtracting to Get Hours and Minutes
Subtract the start time from the end time. A shift from 0815 to 1645 comes out to 8 hours and 30 minutes. When the ending minutes are smaller than the starting minutes, borrow 60 from the hours column. For 0930 to 1715, drop the 17 to 16, add 60 to the 15 to make 75, then subtract 30. That leaves 7 hours and 45 minutes.
Shifts That Cross Midnight
Plain subtraction breaks when a shift starts one day and ends the next. If someone clocks in at 2200 and out at 0600, subtracting gives a negative number. Add 2400 to the clock-out first: 0600 becomes 3000, and 3000 minus 2200 is 0800, or eight hours. This is the most common error on hand-calculated overnight timecards. Payroll software does it automatically; a spreadsheet needs the extra step written in.
Converting Minutes to Decimal Hours
You cannot multiply “8 hours and 30 minutes” by a dollar rate directly, because an hour has 60 minutes rather than 100. Divide the minutes by 60 to get the decimal.
- 15 minutes ÷ 60 = 0.25
- 20 minutes ÷ 60 = 0.33
- 30 minutes ÷ 60 = 0.50
- 45 minutes ÷ 60 = 0.75
When the division runs on forever, as 20 minutes does at 0.3333…, round to the nearest hundredth. That is standard in payroll accounting and the difference works out to fractions of a penny per pay period.
So the 0815-to-1645 shift, 8 hours and 30 minutes, is 8.50 decimal hours. The 0930-to-1715 shift, 7 hours and 45 minutes, is 7.75.
Subtracting Unpaid Meal Breaks
Federal law does not require employers to provide meal breaks, but when they do, breaks of 30 minutes or longer generally do not count as hours worked, as long as the employee is fully relieved of duties during that time.1U.S. Department of Labor. Breaks and Meal Periods Short rest breaks of 5 to 20 minutes are compensable and stay in the total.
If the 0815-to-1645 employee took a 30-minute unpaid lunch, subtract 0.50 from 8.50 for a net of 8.00 hours. Errors pile up here when the break is auto-deducted but the employee actually worked through lunch. The recorded time needs to reflect what happened, not what was scheduled.
Multiplying for Gross Pay
Multiply the decimal hours by the hourly rate. Eight hours at $22.00 is $176.00 for the day. A workweek of 40.75 hours at $20.00 is $815.00 gross. The arithmetic is easy; the accuracy lives in the decimal hours you feed into it.
Overtime Past 40 Hours
Federal law requires non-exempt employees to be paid at least one and a half times their regular rate for every hour worked beyond 40 in a single workweek.2Office of the Law Revision Counsel. 29 USC 207 – Maximum Hours A workweek is a fixed, recurring 168-hour period, seven consecutive 24-hour days, and it does not have to start on Monday. Once the employer sets the starting day and hour, it stays fixed unless permanently changed.3eCFR. 29 CFR 778.105 – Determining the Workweek
Take an employee earning $20.00 an hour who works 46 hours in a workweek. The first 40 hours pay $20.00 each, or $800.00. The remaining 6 hours pay $30.00 each ($20.00 × 1.5), or $180.00. Gross pay for the week is $980.00.
Overtime is calculated per workweek, not per pay period. If you run a biweekly payroll, you still measure the 40-hour threshold in each of the two workweeks separately.
Rounding Clock-In and Clock-Out Times
Many employers round timestamps to the nearest five minutes, sixth of an hour, or quarter hour. Federal regulations allow this, but only if the rounding evens out over time so employees are fully compensated for the hours they actually worked.4eCFR. 29 CFR 785.48 – Use of Time Clocks With quarter-hour rounding, that means rounding down when an employee clocks in 1 to 7 minutes before the quarter and rounding up at 8 minutes or more past it. Rounding that consistently favors the employer violates the rule.
The cleanest approach is to round to the nearest minute or skip rounding altogether. Payroll software has no trouble with precise timestamps, and minute-level tracking takes the question of neutrality off the table.
Records You Have to Keep
Federal law requires employers to keep payroll records showing total hours worked each day and each workweek, the regular hourly rate, straight-time and overtime earnings, and every addition to or deduction from wages. Payroll records must be retained for at least three years, and supporting documents like time cards, wage rate tables, and work schedules for at least two.5U.S. Department of Labor. Fact Sheet 21 – Recordkeeping Requirements Under the Fair Labor Standards Act (FLSA)
This is where the 24-hour clock earns its keep. If a wage dispute or Department of Labor audit surfaces two years later, an unambiguous 1715 on a timecard settles what “5:15” would have to argue about.