Premium Hours on the Costing Report represents the hours equal to the difference between the overtime hours physically worked and the overtime hours paid. These premium hours are not added to totals but can be used for reporting production costs.
For example, an employee works two hours overtime, calculated at time and a half, so is paid the equivalent of three normal working hours.
The Actual overtime the employee physically worked is two hours.
The Paid overtime is three hours.
The Premium overtime is the difference and is therefore one hour (Paid - Actual = 3 - 2 = 1).