You don't see to use signOnSun1
so not exactly sure what you want but this should be closer to what you want :
from datetime import datetime
#Variablesr
FMT = '%H:%M' #Time Format use HH:MM
rate1 = 35.34 #Base Hourly Rate
rate2 = 35.34 #Base Hourly Rate
rate3 = 35.34 #Base Hourly Rate
rate4 = 35.34 #Base Hourly Rate
rate5 = 35.34 #Base Hourly Rate
rate6 = 50 #Base Hourly Rate
rate7 = 70 #Base Hourly Rate
Midnight = "00:00" # make midnight a string
amp = 2.40 #Morning shift penalties
pmp = 2.50 #Afternoon shift penalties
ns = 4.4 #Night shift penalties
cabAll = 8.34 #Cab Allowance
# make sure user know format to use
signOnSun1 = raw_input("What time did you sign on Sunday, enter in format HH:MM: ")
signOffSun1 = raw_input("What time did you sign off Sunday, enter in format HH:MM: ")
# use Midnight string and FMT
diff = (datetime.strptime(signOffSun1, FMT) - datetime.strptime(Midnight,FMT))
print diff
Really you should make sure the user enters correct data using a try/except block and you will get caught if you comparing times before and after midnight
If all times are up to midnight you can hardcode the dates setting midnight to one day after:
FMT = '%H:%M-%Y-%m-%d' #Time Format
rate1 = 35.34 #Base Hourly Rate
rate2 = 35.34 #Base Hourly Rate
rate3 = 35.34 #Base Hourly Rate
rate4 = 35.34 #Base Hourly Rate
rate5 = 35.34 #Base Hourly Rate
rate6 = 50 #Base Hourly Rate
rate7 = 70 #Base Hourly Rate
Midnight = "00:00-1900-01-02"
amp = 2.40 #Morning shift penalties
pmp = 2.50 #Afternoon shift penalties
ns = 4.4 #Night shift penalties
cabAll = 8.34 #Cab Allowance
signOnSun1 = raw_input("What time did you sign on Sunday, enter in format HH:MM: ")
signOffSun1 = raw_input("What time did you sign off Sunday, enter in format HH:MM: ")
diff = datetime.strptime(Midnight, FMT) - datetime.strptime("{}-1900-01-01".format(signOnSun1), FMT)
print diff
与恶龙缠斗过久,自身亦成为恶龙;凝视深渊过久,深渊将回以凝视…