What are Employers' Responsibilities for Overtime Pay?

    The short answer, it depends. In some cases, contracts provide for a reasonable amount of additional work to complete tasks; some may allow accrual of lieu time.

    However, the overall average pay for hours worked must not fall below minimum wage, so if your employee has worked a significant number of extra hours or they are on minimum wage and have worked extra hours, any additional hours of work might mean additional pay.

    In this blog, Guardian Support provides a beginner’s guide to overtime pay, so you can understand what is expected of you as an employer while staying compliant with the relevant laws.

    Beginners Guide to Overtime Pay

    To begin with, it is important that you monitor your employee’s overtime and clearly communicate your overtime policy to them. You may have a sign-in and sign-out system that enables you to record start and finish times for each worker, or you may trust them to keep a record of their working hours each day.

    It’s important that you are able to clearly and accurately document how many hours are worked each month so that you don’t find yourself paying below minimum wage.

    Alternatively, you may choose to pay workers for overtime regardless of whether they meet National Minimum Wage or not.

    Overtime payments can be used as an incentive or as a work benefit which can improve employee retention rates and productivity.

    Voluntary vs. Compulsory Overtime

    Employees cannot be forced into working overtime unless it is clearly stated in their contract that this is a requirement of their role. Even so, working hours cannot usually exceed 48 hours a week over a 17-week period unless there is a written agreement between you and the employee.

    It’s best to proceed with caution in this area, though, as you could be at risk of affecting your employee’s mental health and work/life balance even if they agree to work some additional hours for overtime rates.

    Typically, an employee may choose to work extra hours for the following reasons:

    Can My Employees Refuse Overtime?

    There are busy and quiet periods in every workplace, and when you find yourself in those busier periods, you may need to ask your employees to stay a little later, come in a little earlier, or even spare a few hours during the weekend.

    If it is clearly stated in their contract that they may be required to work overtime and they must comply when asked to do so, anyone who refuses can be taken down the disciplinary route as they are not fulfilling the terms of their contract.

    However, you must be wary if they are refusing to work overtime due to childcare or a protected characteristic, as it would then be dangerous to enforce such a rule.

    Please note that it’s important how you word this in your contracts because it may be interpreted as an optional request rather than a job requirement if not written correctly.

    On the other hand, if this is not something included in any official employee documentation, and your employees refuse to work overtime, then there isn’t anything more you can do about it – it’s their choice.

    If your company is one that may require additional hours of work, then this is something that you should carefully consider when writing up employee contracts.

    Overtime can be a complex issue and there are many more laws and practices that you should be aware of as an employer.

    If you need further support with regard to paying overtime or general overtime in the workplace, we have HR consultants that can offer 24/7 advice and support in that area.

    Call us today on 0845 874 4087 to book a free consultation.

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