Hour balance is the difference between the hours an employee was supposed to work and the hours they actually worked. Positive: they worked more than expected. Negative: they fell short. Knowing how to calculate this correctly is essential for paying overtime accurately and managing the time bank.

The base formula

Hour balance = Hours worked − Contracted hours

Example: João has a 40h/week contract. Last week he worked 9h + 8h + 8.5h + 7h + 8h = 40.5h. Balance: +0.5h.

That half-hour can be compensated with future rest (time bank) or paid as overtime, depending on what has been agreed.

Reference hours per month in 2026

Jan: 21 working days / 168h | Feb: 20 / 160h | Mar: 21 / 168h | Apr: 22 / 176h | May: 19 / 152h | Jun: 22 / 176h | Jul: 23 / 184h | Aug: 21 / 168h | Sep: 22 / 176h | Oct: 22 / 176h | Nov: 21 / 168h | Dec: 23 / 184h

Note: mandatory public holidays reduce the reference hours.

How the time bank works

The time bank accumulates overtime hours to be compensated later as rest time (instead of immediate payment). To learn how to implement it formally, read what a time bank is and how to implement one.

Legal limits: maximum 2h/day in the time bank. Maximum 150h/year by individual agreement. Negative balance must be made up.

Practical calculation — Sofia's example for April 2026

• Contract: 40h/week. Working days in April: 22. Reference hours: 176h
• Missed 1 day without justification: −8h
• Overtime on 3 days: +1h +1.5h +0.5h = +3h
• Actual hours: 176 − 8 + 3 = 171h
• Balance against contract: 171h − 176h = −5h
• Consequence: 5h of absence to deduct from salary. 3h of overtime to add with the applicable premiums.

Positive balance: when to pay or compensate

• Pay as overtime: with the legal premiums (25%, 37.5%, 50% or 100% depending on the type).
• Compensate via time bank: if an agreement exists — the employee takes the hours later.

The decision must be documented in a written agreement before the hours are worked. To send this data correctly to your accountant, read how to export time tracking data for payroll

With Picco, the hour balance is calculated automatically and exported monthly — no manual calculations.