Overtime is calculated based on the overtime settings and overtime factors like 'Working Hours Factor', 'Holiday Factor' and 'Offday Factor' defined against each grade in Cost Factor page under Timesheet module. The overtime Settings page is given under: Timesheet -> Settings -> Cost Factor

Normally the overtime calculation is:  (Basic Salary * OT Hours) / (Working Hours per Month) * OT Factor

The Package amount rate can be included or excluded from overtime amount. If in settings it is selected to include then it will be added based on this formula: (Total Package * OT Hours) / (Working Hours per Month)

When the package amount rate is added to overtime then the full formula will be: 
(Basic Salary * OT Hours) / (Working Hours per Month) * OT Factor + (Total Package * OT Hours) / (Working Hours per Month)

Normaly the Overtime Factor set for:

• Normal Working Days: 0.5 
• Holidays: 1.0 
• Offday: 1.0